Sibur’s new investor speeds up asset sales, builds stake

I had an interesting interview last week with Sibur CEO Dmitry Konov and the president of “Miracle”, the holding company formed by Leonid Mikhelson who is working towards a 100% takeover of the company.

What strongly came across was a determination to keep Sibur separate from Novatek, the gas producer owned by Mikhelson. Longer term he is planning an IPO for Sibur once he has built his stake to 100%.

Here are excerpts from the article I wrote for ICIS news:

Sibur accelerates non-core disposals as it heads for IPO
Sibur is accelerating its programme of non-core disposals as it prepares for an eventual initial public offering (IPO) under the ownership of Russian entrepreneur Leonid Mikhelson, officials with the Russian petrochemical major said.
With the new owner of a 25% stake in Sibur in place since December 2010, moves to sell or create a joint venture for the company’s fertilizer and tyre operations are moving more quickly, Sibur president Dmitry Konov said.
Mikhelson purchased the 25% stake in Sibur from Russia’s Gazprombank and has an option – awaiting regulatory approval – to boost this to 50%. In the long term, he plans to buy 100% of the company.
Konov said: “Having a financial institution as a shareholder compared with a private individual is certainly different. Having Mr Mikhelson as a shareholder should accelerate the disposal of our non-core assets.”
He added: “Mr Mikhelson plans to support management to continue exiting the two major non-core areas of Sibur – fertilizers and tyres. We are in discussions with another Russian tyre producer, Nizhnekamskshina.”
In November 2010, Sibur signed a memorandum of understanding (MoU) with French company Pirelli and Russian technology group Rostechnologii to conclude a series of deals on joint activities in the tyre industry and steelcord production.
Referring to the fertilizer market, Konov said: “We have accelerated talks with potential investors. We believe we could become small shareholders in a larger Russian fertilizer company, as there is plenty of scope for consolidation in this market. We could also sell part of the business.”
A new holding company, Miracle, has been created to hold the Sibur investment for Mikhelson. He has appointed investment banker Pavel Malyi as president of this group and to represent him in the management of Sibur.
Malyi told ICIS that Mikhelson’s ultimate aim will be to take Sibur public.
“Mr Mikhelson has said that a company of Sibur’s stature should be public. It’s clearly a goal that he would encourage.”

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