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VTB Capital cashes in on EPAM Systems’ New York listing

16 Feb 2012

Moscow-based VTB Capital has placed part of its minority stake in offshore software developer EPAM Systems, which last week became only the second company with CIS origins to list on the New York Stock Exchange (NYSE) in eight years.

EPAM offered 6,000,000 shares of common stock priced at $12.00 per share. The last CIS company to go public on NYSE was mining and metals giant Mechel, which floated on the US bourse in 2004.

Founded nearly 20 years ago, EPAM has since grown to become one of the largest IT service providers in Central and Eastern Europe, as well as Commonwealth of Independent States.

The company achieved revenues of $239m in 9M of 2011, up 58 per cent on the 9M of previous year, while adjusted net income increased by 81 per cent from $ 20m to $36m during 9M of 2011.

VTB Capital Private Equity and Special Situations (PESS) bought its stake in EPAM in May 2010, joining majority shareholder Russia Partners. The IPO allows VTB Capital to realise ‘substantial’ IRR on its investment, the firm said in a statement.

Tim Demchenko, head of private equity and special situations at VTB Capital, said, “The IPO of EPAM is a great story for the company and VTB Capital. The proceeds and access to capital markets will continue to fuel EPAM’s growth and international expansion.”

VTB Capital is the investment business of Moscow-based VTB Group, and is one of the three strategic business arms of VTB Group, along with the corporate and retail businesses.

This week the firm also announced it had led a $7.5m Series A investment in cloud computing company Eccentex.

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