. Last Updated: 07/27/2016

VimpelCom Is Russia's NYSE Debut

COMBINED REPORTS


The facade of the New York Stock Exchange was adorned with a Russian flag Friday to signal the debut of Wall Street's first Russian company, Vimpel-Communications.


Preceded by a group of folk dancers and accompanied by former Russian prime minister Yegor Gaidar, VimpelCom, Moscow's top cellular phone company, made an impressive start by attracting $110.7 million from investors.


VimpelCom is not the first Russian company to seek foreign financing. But until now none had managed to clear all the accounting and legal obstacles for a listing on the New York Stock Exchange.


The company's stock is trading as American Depositary Receipts, or ADRs, each representing three-quarters of an underlying VimpelCom share.


Opening at $20.50 the VimpelCom ADRs sold briskly and had posted a gain of $8.25 to $28.75, by midday.


"What we are seeing today is investor enthusiasm and a very successful deal," said Alan Apter of Renaissance Capital, one of the lead banks for the offering.


ADRs, which must be approved by the U.S. Securities and Exchange Commission, allow investors in the United States to buy dollar-denominated foreign shares while avoiding the custodial and settlement problems in the issuer's country.


A number of Russian firms have issued lower-level ADRs, but VimpelCom is the first to qualify for so-called Level 3 receipts, which are traded the most freely and can be used to raise new capital.


Since starting operations in Moscow using the Beeline trademark in 1994, VimpelCom's subscriber base has grown to 45,000 customers. Its president Dmitry Zimin was in New York for the stock debut.


The company is being touted as the best way to quench Russia's powerful thirst for telecommunications after 70 years of rationing. In Moscow alone, 165,000 requests for telephone line installation are languishing.


As a result, more and more Russians are turning to cellular telephones. ()