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Russian loans company Arifmetika plans Canada listing in 2022

Russian loans company Arifmetika plans Canada listing in 2022
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A billboard displays information for the Toronto Stock Exchange (TSX) in Toronto on June 23, 2014. REUTERS/Mark Blench/File photo

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MOSCOW (Reuters) – Russia’s Arifmetika Financial Solutions, which provides small loans to individuals, plans to start trading in Canada in early 2022 and aims to raise about $100 million in the next 12-18 months, the head of the parent company said. OR Group (ORUP.MM) said.

A technical listing, which would allow the microfinance company to trade on the stock exchange without a prior public offering, would extend a flurry of listings by Russian companies, provided geopolitical factors, particularly tensions over Ukraine, do not thwart the plan. Read more

“We are planning to raise about $100 million,” Anton Titov, founder and director of the OR Group, told Reuters. “Deals will be 12-15% per round, with three rounds planned. We plan to take 49% to market in one to one and a half years.”

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In September, OR Group, which began life as the Obuv Rossii shoe chain and has expanded into a broader e-commerce platform, said it plans to include Arifmetika in Canada’s TSX Venture Exchange through a SPAC-equivalent capital pool (CPC), Navigator Acquisition Corporation (NAQp.V). )

Titov, who expects Arifmetika and Navigator to sign a definitive agreement soon, although he did not specify when, said the company could be valued at between $100 million and $140 million after a first round of financing in the first half of next year.

Explaining how a technical offering differed from an initial public offering (IPO), which requires cumbersome regulatory checks, he said, “There’s diversity here — you can pull in money gradually, dilute a big stake, or make small additional issues.”

IPO activity in Russia accelerated as the country recovered from the initial impact of the COVID-19 pandemic and global stock markets rallied, driven in part by retail investment.

In August, video game developer Nexters used Russian special-purpose acquisition firm (SPAC) Kismet to start trading shares on the US Nasdaq exchange. Read more

SPACs are shell companies that raise money for the acquisition of a private company and offer it to the public without the need for a public offering.

Arifmetika’s planned list will be similar.

Titov said the company, founded in 2010, expects 2021 revenue at 2.2 billion rubles ($29.75 million) with a net profit of about 600 million rubles.

Titov said Arifmetika wanted additional money to help it take a leading position in a market that some of Russia’s largest banks were also beginning to enter, as well as for acquisitions.

“Immediately after the agreement, we are ready for effective negotiations,” Titov said, adding that it may expand internationally from 2023, once significant progress is made in the Russian market.

(1 dollar = 73.9586 rubles)

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(Reporting by Olga Popova) Written by Alexander Marrow. Editing by Katya Golubkova and Barbara Lewis

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