JSC NAC Kazatomprom announces the price range for the IPO as well as the commencement of the Offer once an approved price range prospectus has been published

31 October 2018

Russian version (версия на русском языке) – pdf

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Except as mentioned below for Kazakhstan, this announcement is an advertisement for the purposes of the Prospectus Rules of the UK Financial Conduct Authority and not a prospectus and not an offer of securities for sale nor a solicitation of an offer to acquire or a recommendation to sell or buy securities in any jurisdiction, including in or into the United States, Australia, Canada, Japan or the Republic of South Africa. This announcement is not intended to be an advertisement in, and for the purpose of the laws of Kazakhstan.

Neither this announcement, nor anything contained herein shall form the basis of, or be relied upon in connection with, any offer or commitment whatsoever in any jurisdiction. Investors should not subscribe for or purchase any ordinary shares referred to in this announcement except on the basis of information contained in a price range prospectus (the “Price Range Prospectus”) expected to be published by Joint stock company “National atomic company “Kazatomprom” later today in connection with the possible admission of global depositary receipts to the standard listing segment of the Official List of the Financial Conduct Authority of the United Kingdom (the “FCA”) and to trading on the Main Market of the London Stock Exchange plc. A copy of the Price Range Prospectus published by the Company will, if published, be available for inspection from the Company’s registered office at 10 D. Kunayev Street, 010000 (Z05H9A7), Astana, Republic of Kazakhstan and on the Company’s website at www.kazatomprom.kz.

 

 31 October 2018

 JSC NAC Kazatomprom

Announcement of Price Range

 Following the announcement on 22 October 2018 by the joint stock company “National atomic company “Kazatomprom” (the “Company” and, together with its subsidiaries, the “Group” or “Kazatomprom”), the world’s leading uranium producer, regarding its intention to proceed with an initial public offering involving the sale of securities in the Company by Joint stock company Sovereign Wealth Fund Samruk-Kazyna (“Samruk-Kazyna”), the Company’s sole shareholder (the “IPO” or the “Offering”), Kazatomprom today announces the price range for the IPO as well as the commencement of the Offer once an approved price range prospectus (the “Price Range Prospectus”) has been published containing full details of the Offer, which is expected to take place later today.

The Company intends to apply for the admission of global depositary receipts (the “GDRs”) representing an interest in its ordinary shares (the “Shares” and, together with the GDRs, the “Securities”) to the Official List maintained by the UK Financial Conduct Authority, and to trading on the regulated market of the London Stock Exchange (the “UK Admission”), and for the admission of the Shares and GDRs to the Official List of Securities of the Astana International Exchange (“AIX”) and to trading on the AIX.

 Galymzhan Pirmatov, CEO of Kazatomprom, said:

“We have been encouraged by the initial response to our proposed IPO from prospective institutional investors around the world. Kazatomprom offers investors a unique opportunity to participate in a true global leader: the world’s leading uranium producer, with the largest reserves and lowest quartile operating costs. We see significant potential for Kazatomprom. Our market leading position, combined with a strong management team, the highest standards of governance and a market-centric strategy, puts us in a strong position to capitalize on the attractive long-term fundamentals of the uranium market. We look forward to sharing our story with prospective investors over the coming weeks.”

Offer Highlights:

  • The price range for the Offering and the AIX offering has been set at USD 11.6 – 15.4 per GDR or per share, implying an equity value between USD 3.0 and 4.0 billion.
  • The Offering will be a sale of up to 38,903,491 Shares (the “Offer Shares”) by Samruk-Kazyna, which represents 15% of the Company’s issued share capital of 259,356,608 Shares.
  • Simultaneously with the Offering, Samruk-Kazyna will offer not less than 20% of the total number of Offer Shares in a domestic offering of Shares and GDRs to institutional and retail investors in Kazakhstan through the facilities of AIX pursuant to the rules and regulations of the AIX (the “AIX Offering”). The number of Shares and GDRs sold in the AIX Offering will reduce the number of Shares in the form of GDRs available for sale in the Offering. Shares offered in the AIX Offering are expected to be offered at the final offer price in KZT per share that reflects the final offer price in USD per GDR and the official exchange rate of National Bank of Kazakhstan for the day preceding the Pricing Date in connection with the Offering and the AIX Offering.
  • Pursuant to the resolution of the Government of the Republic of Kazakhstan, Samruk-Kazyna is authorised to sell up to 25% of the issued share capital of the Company (the “Authorised Limit”). Samruk-Kazyna may, following consultation with the Joint Global Coordinators, elect to increase the number of Shares in the Offering up to the Authorised Limit.
  • Samruk-Kazyna will grant the Managers (as indicated below) an over-allotment option to purchase a maximum of 15% of the total number of GDRs being sold in the Offering; the over-allotment option is included within the number of Offer Shares indicated above and hence, in the event the over-allotment option is not exercised in full, the total deal size shall reduce accordingly.
  • There will be a lock-up period of 180 days for the Company and Samruk-Kazyna, in each case subject to certain customary exceptions.
  • Consequently, prior any increase in the size of the Offering and assuming 20% of the Offer Shares are sold in the AIX Offering, the base size of the Offering shall be up to 27,063,298 GDRs, with up to an additional 4,059,495 GDRs to be sold pursuant to the over-allotment option.
  • Final pricing is expected to be announced on or around 13 November 2018, with conditional dealings in the GDRs expected to commence on the London Stock Exchange at 8.00 a.m. on the same day.
  • Admission of the GDRs is expected to occur, and unconditional dealings in the GDRs on the London Stock Exchange are expected to commence, on or around 16 November 2018.
  • Admission of the shares on the AIX is expected to occur on or around 13 November 2018, with unconditional dealings in the shares on the AIX expected to commence on or around 14 November 2018. Conditional dealings in the GDRs are expected to commence on the AIX on or around 14 November. Admission of the GDRs on the AIX is expected to occur on or around 16 November, with unconditional dealings in the GDRs on the AIX expected to commence on or around 19 November.
  • Credit Suisse and J.P. Morgan are acting as Joint Global Coordinators and Joint Bookrunners in connection with the Offering; China International Capital Corporation, Halyk Finance and Mizuho International plc are acting as Joint Bookrunners; Numis Securities Limited is acting as a Co-Manager (together, the “Managers”). The AIX Offering is being led by Halyk Finance.

For further information, please contact:

Kazatomprom Public Relations                                                                    

Tel: +7 7172 45 80 63

Email: [email protected]

Kazatomprom Investor Relations

Tel: +7 7172 45 81 80

Email: [email protected]

 Media Enquiries

Powerscourt

Giles Read, Peter Ogden

Tel: +44 20 7250 1446

Email: [email protected]

A copy of this announcement will be made available at www.kazatomprom.kz.

 About Kazatomprom

Kazatomprom is the world’s largest producer of uranium, representing approximately 20% of total global uranium primary production in 2017. The Group benefits from the largest reserve base in the industry, with attributable uranium reserves of just under 300 ktU. Kazatomprom operates, through its subsidiaries, JVs and Associates, 26 deposits grouped into 13 mining assets, all of which are located in Kazakhstan. All of the Group’s uranium deposits are suitable for ISR. A combination of the cost-efficient, low impact ISR technology and a long-life mining asset base allows the Group to remain sustainably among the leading and the lowest cost uranium producers globally.

As the national atomic company in the Republic of Kazakhstan, the Company has partnered with substantially all of the leading players in the uranium mining industry globally. The Group’s primary customers are operators of nuclear generation capacity, and the principal export markets for the Group’s products are China, South and Eastern Asia, North America and Europe. The Group sells uranium and uranium products under long-term contracts, short-term contracts, as well as in the spot market, directly from its headquarters or through its Switzerland-based trading subsidiary. For the year ended 31 December 2017 and the six months ended 30 June 2018, the Group’s consolidated revenue was KZT336.5 billion and KZT145.0 billion, respectively, and profit was KZT139.2 billion and KZT115.0 billion, respectively.

For more information: http://www.kazatomprom.kz

 IMPORTANT NOTICE

The information contained in this announcement is for background purposes only and does not purport to be full or complete, nor does it constitute or form part of any invitation or inducement to engage in investment activity, nor does it constitute an offer or invitation to buy any securities, in any jurisdiction including the United States, or a recommendation in respect of buying, holding or selling any securities. No reliance may be placed by any person for any purpose on the information contained in this announcement or its accuracy, fairness or completeness. The contents of this announcement are not to be construed as legal, financial or tax advice.

This announcement is not for publication or distribution, directly or indirectly, in or into the United States, Australia, Canada, Japan, the Republic of South Africa or any other jurisdiction where to do so would constitute a violation of the relevant laws of such jurisdiction. The distribution of this announcement may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

This announcement is not an offer for sale of any securities in the United States.  Securities may not be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933 (the “U.S. Securities Act”).  JSC NAC Kazatomprom has not registered and does not intend to register any portion of any potential offering in the United States or to conduct a public offering of any securities in the United States.

This announcement is only being distributed to and is directed only at (i) persons who are outside the United Kingdom, or (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) and (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2) of the Order (all such persons together being referred to as “relevant persons”).  Any investment or investment activity to which this announcement relates will only be available to and will only be engaged in with relevant persons.  Any person who is not a relevant person should not act or rely on this announcement or any of its contents.

Any offer of securities to the public that may be deemed to be made pursuant to this announcement in any EEA Member State that has implemented EU Directive 2003/71/EC (as amended, together with any applicable implementing measures in any Member State, the “Prospectus Directive”) is addressed solely to qualified investors (within the meaning of Article 2(1)(e) of the Prospectus Directive) in that Member State.

Information contained herein is not an offer, or an invitation to make offers, to sell, purchase, exchange or otherwise transfer securities in Kazakhstan to or for the benefit of any Kazakhstani person or entity, except for those persons or entities that are capable to do so under the legislation of the Republic of Kazakhstan and any other laws applicable to such capacity of such persons or entities. This announcement shall not be construed as an advertisement (i.e. information intended for an unlimited group of persons which is distributed and placed in any form and aimed to create or maintain interest in JSC NAC Kazatomprom and its merchandise, trademarks, works, services and/or its securities and promote their sales) in, and for the purpose of the laws of Kazakhstan, unless such advertisement is in full compliance with Kazakhstan laws.  No future dividends under, and/or increase of market value of the securities of JSC NAC Kazatomprom are guaranteed whether explicitly or by any implication whatsoever.

None of Credit Suisse Securities (Europe) Limited, J.P. Morgan Securities plc, China International Capital Corporation Hong Kong Securities Limited, JSC Halyk Finance, Mizuho International plc and Numis Securities Limited (together, the “Banks”) nor any of their respective affiliates, their respective directors, officers or employees, advisers, agents or any other person accepts any responsibility or liability whatsoever for the contents of, or makes any representations or warranties, express or implied, as to the accuracy, fairness or completeness of the information presented or contained in this announcement (or whether any information has been omitted from this announcement) or any other information relating to the Group, its subsidiaries and their associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection therewith. Accordingly, each of the Banks and their respective affiliates, their respective directors, officers or employees, and any other person acting on their behalf expressly disclaims, to the fullest extent possible, any and all liability whatsoever for any loss howsoever arising from, or in reliance upon, the whole or any part of the contents of this announcement, whether in tort, contract or otherwise which they might otherwise have in respect of this announcement or its contents or otherwise arising in connection therewith.

Credit Suisse Securities (Europe) Limited and J.P. Morgan Securities plc are authorised by the UK Prudential Regulation Authority (the “PRA”) and regulated by the FCA and the PRA. Each of the Banks is acting exclusively for the Company and no one else in connection with the matters referred to in this announcement, and will not regard any other person as their respective clients in relation to the matters referred to in this announcement and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients nor for providing advice in relation to the matters referred to in this announcement, the contents of this announcement or any transaction, arrangement or other matter referred to herein.

In connection with the Offering, Credit Suisse Securities (Europe) Limited (the “Stabilising Manager”), or any of its agents, may (but will be under no obligation to), to the extent permitted by applicable law, over-allot GDRs or effect other transactions with a view to supporting the market price of the GDRs at a higher level than that which might otherwise prevail in the open market. The Stabilising Manager is not required to enter into such transactions and such transactions may be effected on any stock market, over-the-counter market, stock exchange or otherwise and may be undertaken at any time during the period commencing on the date of the commencement of conditional dealings of the GDRs on the London Stock Exchange and ending no later than 30 calendar days thereafter. However, there will be no obligation on the Stabilising Manager or any of its agents to effect stabilising transactions and there is no assurance that stabilising transactions will be undertaken. Such stabilising measures, if commenced, may be discontinued at any time without prior notice. In no event will measures be taken to stabilise the market price of the GDRs above the Offer Price. Save as required by law or regulation, neither the Stabilising Manager nor any of its agents intends to disclose the extent of any over- allotments made and/or stabilisation transactions conducted in relation to the Offering.

In connection with the Offering, the Stabilising Manager may, for stabilisation purposes, over-allot GDRs up to a maximum of 15 per cent. of the total number of GDRs comprised in the Offering. For the purposes of allowing it to cover short positions resulting from any such over-allotments and/or from sales of GDRs effected by it during the stabilising period, it is expected that certain existing shareholders will grant to the Stabilising Manager on behalf of the Banks, an option, pursuant to which the Stabilising Manager may purchase, or procure purchasers for, additional GDRs up to a maximum of 15 per cent. of the total number of GDRs comprised in the Offering (the “Over-allotment GDRs”) at the Offer Price. The over-allotment arrangements may be exercised in whole or in part upon notice by the Stabilising Manager at any time on or before the 30th calendar day after the commencement of conditional dealings in the GDRs on the London Stock Exchange. Any Over-allotment GDRs made available pursuant to the over-allotment arrangements will rank pari passu in all respects with the GDRs, including for all dividends and other distributions declared, made or paid on the GDRs, will be purchased on the same terms and conditions as the GDRs being issued or sold in the Offering and will form a single class for all purposes with the other GDRs.

Certain statements in this announcement are not historical facts and are “forward looking” within the meaning of Section 27A of the U.S. Securities Act and Section 21E of the U.S. Securities Exchange Act of 1934.  Forward looking statements include statements concerning our plans, expectations, projections, objectives, targets, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, plans or intentions relating to acquisitions, our competitive strengths and weaknesses, plans or goals relating to development projects, financial position and future operations and development, our business strategy and the trends we anticipate in the industries and the political and legal environment in which we operate and other information that is not historical information.  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.  Given these risks and uncertainties, be cautioned not to place undue reliance on such forward looking statements.  We do not intend and we do not assume any obligation to update any forward looking statement contained herein.

In addition, this announcement contains information concerning the Group’s industry and its market and business segments generally, which is forward-looking in nature and is based on a variety of assumptions regarding the ways in which the industry, and the Group’s market and business segments, will develop. These assumptions are based on information currently available to the Company. If any one or more of these assumptions turn out to be incorrect, actual market results may differ from those predicted. While the Company does not know what effect any such differences may have on the Group’s business, if there are such differences, they could have a material adverse effect on the Group’s future results of operations and financial condition.

Any subscription or purchase of Securities in the possible Offering should be made solely on the basis of information contained in the Price Range Prospectus expected to be published by  the Company in connection with the Offering.

The information in this announcement is subject to change. Before subscribing for or purchasing any Securities, persons viewing this announcement should ensure that they fully understand and accept the risks which will be set out in the Price Range Prospectus expected to be published by  the Company in connection with the Offering. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness. Neither this announcement, nor anything contained in the Price Range Prospectus referred to herein, shall form the basis of or constitute any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for any Securities or any other securities nor shall it (or any part of it) or the fact of its distribution, form the basis of, or be relied on in connection with, any contract therefor.

Financial decisions should not be based on this announcement. Acquiring investments to which this announcement relates may expose an investor to a significant risk of losing all of the amount invested.

Persons considering making investments should consult an authorised person specialising in advising on such investments. Neither this announcement, nor the Price Range Prospectus referred to herein, constitutes a recommendation concerning a possible offer. The value of shares can decrease as well as increase. Potential investors should consult a professional advisor as to the suitability of a possible offer for the person concerned.