24 Mar 2015 07:00
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This document is an advertisement and is not a prospectus for the purposes of the Prospectus Directive. A prospectus prepared pursuant to the Prospectus Directive is intended to be published, which, when published, can be obtained from Lenta Ltd. at its registered office. Investors should not subscribe for any securities referred to in this document except on the basis of information contained in the prospectus. The expression "Prospectus Directive" means Directive 2003/71/EC (and amendments thereto, including Directive 2010/73/EU, to the extent implemented in any relevant Member State) and includes any relevant implementing measure in the relevant Member State.
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LENTA SUCCESSFULLY COMPLETED A PRIMARY CAPITAL INCREASE OF $225 MILLION TO PROVIDE FINANCIAL FLEXIBILITY FOR ACCELERATED EXPANSION
St. Petersburg, Russia; 23 March 2015 - Lenta Ltd (LSE, MOEX: LNTA / LNTR; "Lenta" or the "Company"), one of the largest retail chains in Russia, is pleased to announce the successful completion of the equity placing of$225 million (the "Placing").
Results of the Placing
· Lenta has successfully completed an equity placing of 35.2 million new GDRs via an accelerated bookbuild raising gross proceeds of $225 million.
· The shares were sold at a price of $6.40 per new GDR.
· The Company has applied to the FCA, in its capacity as competent authority under the FSMA, for the GDRs to be admitted to the Official List of the FCA and to the LSE to admit the GDRs for trading under the symbol LNTA on its market for listed securities, on which the Company's existing GDRs are admitted to trading, through its IOB. Subject to the transfer restrictions described under the following chapters of the Prospectus: "Selling and Transfer Restrictions", "Plan of Distribution" and "Settlement and Delivery" and "Risk Factors - Risks Relating to the GDRs and the Trading Market - The GDRs may be delisted from MICEX", the GDRs will be fungible with the existing GDRs.
· The Company expects that unconditional trading in the GDRs through the IOB will commence on or about 27 March 2015 (the "Closing Date").
· Settlement of the Placing is expected to take place on 27 March 2015.
· Credit Suisse Securities (Europe) Limited, J.P. Morgan Securities plc and VTB Capital PLC are acting as Joint Global Coordinators and Joint Bookrunners in connection with the Placing.
Lock-Ups
There will be a lock-up period of 90 days for the Company, Luna Inc. (the investment vehicle of TPG Capital) and the European Bank for Reconstruction and Development in relation to their respective shareholdings in the Company following the Placing.
Updated guidance:
Following successful completion of the Placing, Lenta is positioned to increase certain of its previously announced growth targets and therefore to update its 2015 guidance as follows:
· Lenta to open at least 25 new hypermarkets in 2015 versus previous guidance of 20-25
· Supermarket new openings target of 10-15 new stores in 2015 remains unchanged
· Total sales growth guidance remains 34-38%, as the incremental hypermarket openings will occur towards the end of the year, benefitting sales growth primarily in 2016
· Planned capital expenditure will increase by approximately RUB 5bn to around RUB 30bn for 2015, with the majority of the incremental capex deployed in 2H 2015. Capital expenditure might be further increased in the course of the year subject to market conditions and availability of suitable opportunities.
Looking ahead, Lenta expects to further increase hypermarket openings in 2016 to be broadly in line with the number of openings in 2014 and to maintain a similar or higher pace of expansion thereafter. The number of supermarket openings is also expected to increase in 2016.
Lenta has previously confirmed that it remains on track to meet its goal of doubling selling space over the three years to December 2016. The acceleration enabled by the capital increase is expected to result in this goal being comfortably exceeded.
Lenta's Chief Executive Officer, Jan Dunning said:
"We are pleased to announce the successful completion of our $225 million equity placing and would like to welcome all our new shareholders.
Our low-price / low-cost business model, strong financial results and further acceleration of sales growth in early 2015 combined with our proven capability to deliver rapid new store expansion put Lenta in a strong position to capitalise on the growth opportunities in Russian food retail. The current economic environment provides a chance for us to grow even more quickly as our model is well-adapted to the needs of consumers facing pressure on household budgets and new store development opportunities are more plentiful.
The proceeds of the capital increase will strengthen our balance sheet and give us the additional financial flexibility to accelerate our store opening programme in 2015 and beyond.
With this further acceleration in new store openings we expect to comfortably exceed our target of doubling net selling space over the three years to December 2016."
***For further information, please visit www.lentainvestor.com, or contact:
Lenta
Anna Meleshina, Director of Public Relations and Government Affairs
+7 812 363 28 53
Anna.Meleshina@lenta.com
Albert Avetikov, Director of Investor Relations
+7 812 363 28 44
Albert.Avetikov@lenta.com
About Lenta
Lenta is one of the largest retail chains in Russia and the country's second largest hypermarket chain (in terms of 2013 sales). The Company was founded in 1993 in St. Petersburg. Lenta operates 111 hypermarkets in 62 cities across Russia and 24 supermarkets in Moscow and the Moscow region, with a total of approximately 720,590 sq.m. of selling space. The average Lenta hypermarket store has selling space of approximately 6,300 sq.m. The Company operates four hypermarket distribution centres.
The Company's price-led hypermarket formats are differentiated in terms of their promotion and pricing strategies as well as their local product assortment. The Company employed approximately 35,100 1 people as of 31 December 2014.
The Company's management team combines a mix of local knowledge and international expertise coupled with extensive operational experience in Russia. Lenta's largest shareholders include TPG Capital, the European Bank for Reconstruction and Development and VTB Capital Private Equity, all of whom are committed to maintaining high standards of corporate governance. Lenta is listed and trades on the London Stock Exchange under the tickers 'LNTA' and 'LNTR' and on the Moscow Exchange under the ticker 'LNTA'.
1 FTE (Full-time equivalent). Average FTE for 2014 was 27,200 employees.
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Credit Suisse, J.P. Morgan and VTB Capital are acting exclusively for the Company and no one else in connection with the Offering and will not regard any other person (whether or not a recipient of this press release) as their client in relation to the Offering and will not be responsible to anyone other than the Company for providing the protections afforded to their client.
Information contained herein is not an offer, or an invitation to make offers, to sell, purchase, exchange or otherwise transfer securities in the Russian Federation to or for the benefit of any Russian person or entity, except to the extent permitted under Russian securities laws. This document is not an advertisement in connection with the "placement" or "public circulation" (as both terms are defined under Russian securities law) of any securities and securities are not intended for "placement" or "public circulation" in the Russian Federation, in each case unless otherwise permitted under Russian securities laws. Neither securities nor a prospectus relating to such securities has been or will be registered with the Central Bank of Russia.
This document may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements may be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will" or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. By their very nature, forward looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that the predictions, forecasts, projections and other forward looking statements will not be achieved. As a result, actual future results may differ materially from the plans, goals and expectations set out in these forward-looking statements. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements.
Any forward-looking statements made by or on behalf of Lenta speak only as at the date of this announcement. Subject to its legal and regulatory obligations, neither the Company, nor any of its agents, employees or advisors intends or has any duty or obligation to supplement, amend, update or revise any of the forward looking statements contained in this document to reflect any change in expectations with regard thereto or any change in events, conditions or circumstances on which any statement is based.
In no circumstances shall the provision of this document imply that no negative change may occur in the business of the Company after the date of provision of this document, or any date of amendment and/or addition thereto.