U.S.-listed Freedom Holding looks at potential secondary listing to raise cash

Andrey Ostroukh and Elena Fabrichnaya
·2 min read

By Andrey Ostroukh and Elena Fabrichnaya

MOSCOW, Jan 14 (Reuters) - Financial services group Freedom Holding Corp, listed on Nasdaq and in St Petersburg, is looking at options to raise money including via secondary public offerings of shares, its boss said in an interview with Reuters.

Freedom Holding Corp, which provides access to the U.S. stock market for investors mostly in Russia and Kazakhstan, listed on Nasdaq in October 2019 and its shares also trade on the St Petersburg exchange, in which it owns a 12.8% stake.

Timur Turlov, Freedom Holding Corp's founder and chief executive, said the company was considering various ways to raise capital and was in preliminary talks on a secondary public offering option (SPO) although such plans were not imminent.

"We do not rule out an SPO," Turlov said, adding that such plans would depend on possible merger and acquisitions opportunities.

Freedom Holding Corp, with a market capitalisation of around $2.9 billion, bought U.S. brokerage firm Prime Executions in late 2020 giving it direct access to the U.S. market.

Turlov, who declined to disclose the price paid for the U.S. brokerage, said Freedom Holding Corp does not have specific plans for new acquisitions but is now able to finance a possible deal with shares or cash.

Turlov said Freedom Holding Corp was not planning to substantially increase its stake in the St Petersburg exchange and would be happy to help organise a possible initial public offering for Russia's second-largest stock exchange.

"The St Petersburg exchange is becoming one of the large pools of liquidity for foreign stocks. I don't rule out that it will attract U.S. professional arbitrageurs to trade foreign stocks and make arbitrage deals with U.S. stock exchanges," Turlov said.

The St Petersburg exchange focuses on providing access to foreign stocks, including U.S. blue chips, trading them in dollars and euros.

Its client numbers have grown rapidly as a record-high number of Russian retail investors turned to trading foreign stocks during coronavirus lockdowns and because of low interest rates. (Reporting by Andrey Ostroukh and Elena Fabrichnaya. Editing by Jane Merriman)