Alexander Marrow, Olga Popova

MOSCOW, (Reuters) – Russia’s Melon Fashion Group picked Sberbank CIB (VTB Capital), Goldman Sachs (NYSE 🙂 and BofA (NYSE 🙂 to assist with its 2022 initial public offering. This was confirmed Tuesday by two people familiar with the plans.

Several Russian companies might hold IPOs next Year, extending their listing spree which began a year ago. However, geopolitics including Ukraine tensions and other risks may not thwart these plans.

According to one financial market source, Melon aims to list by autumn 2022. Melon will list next year according to another financial market source.

Melon Fashion and VTB Capital declined to comment. BofA and Sberbank CIB did not respond immediately.

Melon CEO Mikhail Urzhumtsev stated to Reuters that it was too soon for a company to go public with an IPO.

He stated that an IPO was one of many opportunities to the company’s growth, but did not provide further information.

Russian companies were more interested in listing shares than ever before October’s record MOEX Index. However, a sell-off in the following months has brought home the vulnerability of Russia to external shocks.

Melon is based in St Petersburg, on a site which used to house a Soviet sewing machine. It owns four fashion brands, primarily women’s – Zarina and Befree as well as Love Republic and Sela – with approximately 815 shops across Russia and CIS.

Melon’s revenues jumped 66% to 28.3 Billion Rupees ($383.5 Million) in the first nine month of 2021, surpassing 2020. Online sales grew from 7% to 34% of 2017’s total in 2017, up to 34% for 2020.

Urzhumtsev explained that they are launching online penetration in countries outside Russia and CIS and that it is the best way to get out of Russia.

Swedish real estate company Eastnine holds 36% of Melon. Its nine-month report stated that Melon’s strong growth has opened up opportunities for divestment. Eastnine suggested that such an IPO could be possible before the summer of 2022.

Melon’s creative hub is located in St Petersburg where style and retail stores are created. The majority of production is located elsewhere.

Urzhumtsev explained that sustainability has been a key focus of his company for a while, but that the firm was now focusing on a thorough assessment of its supply chain as well as factories in next year.

($1 = 73.8010 roubles)