The company said in a press release that shareholders of Open Investments exercised their pre-emptive right and bought out 69.9% of additional shares. Based on the placement price of around $290 per share, the company's core shareholders invested around $413 mln. What's more, a total of 613,851 additional shares are to be placed by public offering. Assuming that the additional shares are successfully placed in full, the proceeds could top $590.9 mln.
We are moderately upbeat on the results of the company's share placement and strong demand for Open Investments shares on the part of existing shareholders even in the absence of preferential treatment in terms of the placement price as part of their pre-emptive right. Sufficiently high proceeds will enable the company to significantly expand its land bank to implement suburban real estate projects. Around 70% of the proceeds raised are to be earmarked for acquisition of land plots in the Moscow region.
According to our estimates, the estimated fair price for Open Investments is $319.1 per share. Our recommendation is Hold.
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