Russia: Investment Banking Review First Quarter 2020 Refinitiv Deals Intelligence

1 REPORT SUMMARY

INVESTMENT BANKING FEES Investment banking fees generated in reached an estimated US$90.7 million during the first quarter of 2020, 55% more than the value recorded during the same period in 2019 and the highest first quarter total since 2017. Fees generated from completed M&A transactions increased 61% year-on-year to a three-year high of US$20.1 million. Equity capital markets underwriting fees increased 79% to US$22.1 million, the highest first quarter level since 2014, while debt capital markets underwriting fees declined 27% to a four-year low of US$21.9 million. Syndicated lending fees totalled US$26.6 million, more than seven-times the value recorded during the opening three months of 2019.

MERGERS & ACQUISITIONS In February, the Russian government announced that it would use the National Wealth Fund to purchase the central ’s stake in Sberbank. The deal, valued at US$39.6 billion, has had a huge impact on M&A volumes in Russia during Q1 2020. M&A with any Russian involvement reached a four-year high of US$43.2 billion, more than eight- times the value recorded during the first three months of 2019. It should be noted that the number of deals announced during the first quarter declined 9% over the same period and, without the aforementioned deal, Russian involvement M&A declined 29% from last year. The deal boosted Russian target M&A to US$43.0 billion as domestic M&A reached an all-time high. Meanwhile, Russian inbound M&A declined 80% to US$305.5 million. Russian outbound M&A totalled US$68.6 billion during the first three months of 2020, more than ten-times the value recorded at this time last year and a four-year high. VTB Capital holds the top spot in the financial advisor ranking for deals with any Russian involvement during the first quarter of 2020, followed by in second position.

EQUITY CAPITAL MARKETS Russian equity and equity-related issuance totalled US$1.25 billion during the first quarter of 2020, up 66% compared to the same period last year despite only one issue being recorded during the quarter, compared to two during the first three months of 2019. Russian internet company, Yandex, raised a US$1.25 billion with its convertible bond offering in February. For their work on this deal, five share first place in the Q1 2020 Russian equity capital markets league table; VTB Capital, , UBS, Morgan Stanley and JP Morgan.

DEBT CAPITAL MARKETS Russian bond issuance totaled US$7.9 billion during the first quarter of 2020, 24% less than the same period last year and a four-year low. The number of issues declined 18% to an eleven-year low. Financial sector issuance accounted 58% of proceeds raised during the first quarter, while bonds from issuers in the materials sector accounted for 12%. VTB Capital topped the Russian DCM underwriting league table during Q1 2020, with a 34% market share. Gazprombank and JP Morgan follow in second and third positions, respectively.

2 BACK TO Russia HIGHLIGHTS INVESTMENT BANKING FEES PAGE

INVESTMENT BANKING FEE VOLUMES TOP FEE PAYING INDUSTRIES

• Outer Rim: YTD YTD Fees Rest of Year Fees • Inner Rim: YTDLY 1,400 3% 8% 1,200

1,000 9% 33% 25% 31% 800

600 0% US$Million

400 17% 23% 13% 200 14% 0 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 24%

YTD INVESTMENT BANKING FEES BY ASSET CLASS

BONDS EQUITY LOANS MA Materials Energy and Power 140 High Technology Telecommunications 120 Financials Other 100

80

60 US$Million 40

20

0 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 3 BACK TO Russia HIGHLIGHTS MERGERS & ACQUISITIONS PAGE

ANY INVOLVEMENT M&A VOLUMES & NUMBER OF DEALS Russian TARGET M&A: TOP TARGETED INDUSTRIES

YTD (US$ bil) $39.6b Sberbank Rossi* Rest of Year (US$ bil) # Deals • Outer Rim: YTD $160 900 • Inner Rim: YTDLY

$140 800 700 $120 3%1%0%0% 600 4% $100 500 $80 400 13% 22% $60 0% 300 $40 200 0% 24% $20 100

$0 - 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20

41% TARGET M&A VOLUMES & NUMBER OF DEALS

YTD (US$ bil) $39.6b Sberbank Rossi* Rest of Year (US$ bil) # Deals 92% $140 900

800 $120 700 $100 Financials High Technology 600 Materials Energy and Power $80 500 Industrials Other $60 400 300 $40 200 $20 100

$0 - 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20

*Russian National Wealth Fund’s U$39.6 billion majority stake purchase in Sberbank highlighted to show the impact this one deal had on Q1 values. 4 BACK TO Russia HIGHLIGHTS MERGERS & ACQUISITIONS PAGE

INBOUND M&A DOMESTIC M&A OUTBOUND M&A Inbound M&A down 80% YTD to US$305.5 million Domestic M&A up 2677% from last year to Outbound M&A up 909% from last year to US$42.7 billion US$68.6 million

YTD (US$ bil) Rest of Year (US$ bil) # Deals YTD (US$ bil) Rest of Year (US$ bil) # Deals YTD (US$ bil) Rest of Year (US$ bil) # Deals $40 180 $90 700 $20 45

160 $80 $18 40 $35 600 140 $70 $16 35 $30 500 $14 120 $60 30 $25 $12 100 $50 400 25 $20 $10 80 $40 300 20 $15 $8 60 $30 15 200 $6 $10 40 $20 $4 10 100 $5 20 $10 $2 5 $0 - $0 - $0 - 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20

INBOUND M&A VOLUMES OUTBOUND M&A VOLUMES TOP ACQUIRING NATIONS TOP TARGETED NATIONS

US$ Million US$ Million $0 $50 $100 $150 $200 $0 $10 $20 $30 $40 $50

Cyprus $169.4 Germany $39.0

United States of America $98.4 South Korea $20.0

South Korea $19.7 Cyprus $9.6

Unknown $10.2 Czech Republic $0.0

Republic of Ireland $4.5 Armenia $0.0

5 BACK TO Russia HIGHLIGHTS MERGERS & ACQUISITIONS PAGE

ANY INVOLVEMENT M&A TOP DEALS YTD

Value Status Rank Date Target Name Target Nation Target Industry Acquiror Name Acquiror Nation Target Financial Advisor Acquiror Financial Advisor ($Mil)

39,557.5 Pending 2/13/2020 Sberbank Rossii PAO Russian Fed Financials Russian National Wealth Fund Russian Fed

1,579.4 Completed 2/6/2020 EN+ GROUP IPJSC Russian Fed Materials EN+ GROUP IPJSC Russian Fed VTB Capital

978.2 Pending 1/15/2020 TransContainer PJSC Russian Fed Industrials Delo-Tsentr OOO Russian Fed VTB Capital

286.8 Completed 1/13/2020 DataLine LLC Russian Fed High Technology Tsentr Khraneniia Dannykh Russian Fed VTB Capital

163.4 Pending 1/9/2020 OGK-2-Thermal power station Russian Fed Energy and Power Eniseiskaia TGK (TGK-13) AO Cyprus

99.0 Completed 1/30/2020 TsOU AO Russian Fed Materials Tvel AO Russian Fed OSG Records Management 98.4 Completed 1/9/2020 Russian Fed High Technology Iron Mountain Inc United States Center

86.8 Pending 2/14/2020 Conexus Baltic Grid AS Latvia Energy and Power Undisclosed Acquiror Unknown

78.3 Pending 3/3/2020 Sintez JSC Russian Fed Healthcare Sinocom Investments Ltd Russian Fed

57.0 Completed 3/2/2020 Trans-Grein OOO Russian Fed Industrials Investor Group Russian Fed VTB Capital

6 BACK TO Russia HIGHLIGHTS EQUITY CAPITAL MARKETS PAGE

ECM PROCEEDS

YTD Proceeds Rest of Year Proceeds 35,000

30,000

25,000

20,000

15,000 US$Million

10,000

5,000

0 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 ECM PROCEEDS BY ISSUE TYPE

IPO Follow-On Convertible 7,000

6,000

5,000

4,000

3,000 US$Million 2,000

1,000

0 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20

7 BACK TO Russia HIGHLIGHTS DEBT CAPITAL MARKETS PAGE

DCM PROCEEDS TOP ISSUING INDUSTRIES YTD Proceeds Rest of Year Proceeds

$80 YTD Proceeds YTDLY Proceeds

$70 US$ Billion

$4.5 $60 Financials $2.5 $50 $1.0 Materials $40 $1.0

US$Billion $30 Consumer Products and $0.8 Services $0.0 $20 $0.5 $10 Industrials $1.0 $0 $0.5 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 Telecommunications $0.4

DCM PROCEEDS YTD BY ISSUE TYPE $0.6 Other $6.1 Agency, Supranational, Sovereign Investment Grade Corporate MBS ABS Federal Credit Agency High Yield Corporate $20 $18 $16 $14 $12 $10

$8 US$Billion $6 $4 $2 $0 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20

8 BACK TO Russia HIGHLIGHTS EQUITY & DEBT CAPITAL MARKETS TOP DEALS PAGE

ECM TOP DEALS YTD

Proceeds Primary Issue Date Issuer Industry Mid Industry Issue Type ($ mil) Exchange

2/25/2020 1,250.0 Yandex NV High Technology Internet Software & Services Convertible ISE

DCM TOP DEALS YTD

Proceeds Issue Date Issuer Industry Mid Industry Issue Type Currency ($ mil) Emerging Market Corporate 2/18/2020 2,000.0 Gaz Finance PLC Financials Other Financials U.S. Dollar Investment Grade Corporate Emerging Market Corporate Russian 2/11/2020 768.0 TransFin-M OJSC Consumer Products and Services Other Consumer Products Investment Grade Corporate Rouble

3/3/2020 600.0 Gtlk Europe Capital Financials Other Financials High Yield Corporate U.S. Dollar

Emerging Market Corporate Russian 1/29/2020 569.5 GTLK-1520 OOO Financials Other Financials Investment Grade Corporate Rouble Emerging Market Corporate Russian 1/27/2020 556.1 Sberbank Rossii PAO Financials Banks Investment Grade Corporate Rouble

9 BACK TO Russia HIGHLIGHTS INVESTMENT BANKING FEE LEAGUE TABLES PAGE

INVESTMENT BANKING FEES LEAGUE TABLE

VTB Capital Goldman Sachs & Co JP Morgan Citi UBS Morgan Stanley Gazprombank Mizuho Financial Group ING 30

25 27.6%

20

15

Fees US$ Million FeesUS$ 10

7.8% 7.1% 6.7% 5 5.7% 4.3% 4.1% 3.7% 3.1% 0 0 1 2 3 4 5 6 7 8 9 10 11 Rank

INVESTMENT BANKING FEES LEAGUE TABLE (US$MIL)

FEES FEES YOY SHARE YOY #DEALS YOY Q1 2020 Q1 2019 BANK NAME SHARE (%) #DEALS (US$Mil) CHANGE (%) CHANGE (%) CHANGE (%)

1 1 VTB Capital $ 25.1 28.2% 27.6% -5.8% 21 -12.5% 2 - Goldman Sachs & Co $ 7.1 - 7.8% - 1 - 3 5 JP Morgan $ 6.4 75.5% 7.1% 0.8% 4 -20.0% 4 4 Citi $ 6.1 58.2% 6.7% 0.1% 4 33.3% 5 19 UniCredit $ 5.1 1243.2% 5.7% 5.0% 3 50.0% 6 9 UBS $ 3.9 132.4% 4.3% 1.4% 2 100.0% 7 - Morgan Stanley $ 3.8 - 4.1% - 1 - 8 2 Gazprombank $ 3.4 -49.2% 3.7% -7.7% 8 14.3% 9 15 Mizuho Financial Group $ 2.8 468.5% 3.1% 2.3% 2 100.0% 9 14 ING $ 2.8 448.2% 3.1% 2.2% 2 0.0% TOTAL $ 90.7 55.2% 26 -27.8%

10 BACK TO Russia HIGHLIGHTS INVESTMENT BANKING FEE LEAGUE TABLES PAGE

M&A FEES LEAGUE TABLE (US$MIL)

FEES FEES YOY SHARE YOY #DEALS YOY Q1 2020 Q1 2019 BANK NAME SHARE (%) #DEALS (US$Mil) CHANGE (%) CHANGE (%) CHANGE (%)

1 1 VTB Capital $ 14.3 230.4% 71.0% 36.5% 6 20.0% 2 - Citi $ 5.8 - 29.0% - 3 - - - 0 ------0 ------0 ------0 ------0 ------0 ------0 ------0 ------TOTAL $ 20.1 60.6% 6 -33.3%

ECM FEES LEAGUE TABLE (US$MIL)

FEES FEES YOY SHARE YOY #DEALS YOY Q1 2020 Q1 2019 BANK NAME SHARE (%) #DEALS (US$Mil) CHANGE (%) CHANGE (%) CHANGE (%)

1 - Goldman Sachs & Co $ 7.1 - 32.0% - 1 - 2 4 UBS $ 3.8 124.5% 17.0% 3.5% 1 0.0% 2 3 VTB Capital $ 3.8 103.6% 17.0% 2.1% 1 0.0% 2 - JP Morgan $ 3.8 - 17.0% - 1 - 2 - Morgan Stanley $ 3.8 - 17.0% - 1 - - - 0 ------0 ------0 ------0 ------0 ------TOTAL $ 22.1 78.9% 1 -66.7%

11 BACK TO Russia HIGHLIGHTS INVESTMENT BANKING FEE LEAGUE TABLES PAGE

DCM FEES LEAGUE TABLE (US$MIL)

FEES FEES YOY SHARE YOY #DEALS YOY Q1 2020 Q1 2019 BANK NAME SHARE (%) #DEALS (US$Mil) CHANGE (%) CHANGE (%) CHANGE (%)

1 1 VTB Capital $ 7.0 -47.6% 32.1% -12.3% 13 -27.8% 2 2 Gazprombank $ 3.4 -43.9% 15.4% -4.5% 8 14.3% 3 4 JP Morgan $ 2.6 46.1% 12.1% 6.1% 3 0.0% 4 13 UniCredit $ 2.3 500.9% 10.5% 9.2% 1 -50.0% 5 3 Sberbank CIB $ 2.2 -28.0% 10.2% -0.1% 8 -33.3% 6 15 Credit Bank of $ 1.4 370.6% 6.6% 5.6% 4 100.0% 6 - Alfa Bank $ 1.4 - 6.6% - 4 - 8 8 Renaissance Capital Group $ 0.4 -23.6% 1.7% 0.1% 2 100.0% 9 16 Raiffeisen Bank International $ 0.3 23.5% 1.2% 0.5% 2 0.0% 10 14 Citi $ 0.2 -33.2% 1.0% -0.1% 1 0.0% TOTAL $ 21.9 -27.4% 16 -27.3%

LOANS FEES LEAGUE TABLE (US$MIL)

FEES FEES YOY SHARE YOY #DEALS YOY Q1 2020 Q1 2019 BANK NAME SHARE (%) #DEALS (US$Mil) CHANGE (%) CHANGE (%) CHANGE (%)

1 7 ING $ 2.8 - 10.7% 10.7% 2 100.0% 1 - UniCredit $ 2.8 - 10.7% - 2 - 1 - Mizuho Financial Group $ 2.8 - 10.7% - 2 - 1 - Banca IMI (Intesa Sanpaolo) $ 2.8 - 10.7% - 2 - 1 - Credit Agricole CIB $ 2.8 - 10.7% - 2 - 6 1 $ 2.3 80.1% 8.6% -28.9% 1 - 6 7 Commerzbank AG $ 2.3 - 8.6% 8.6% 1 0.0% 6 - Sumitomo Mitsui Finl Grp Inc $ 2.3 - 8.6% - 1 - 6 - Mitsubishi UFJ Financial Group $ 2.3 - 8.6% - 1 - 6 - Bank of China Ltd $ 2.3 - 8.6% - 1 - TOTAL $ 26.6 682.5% 3 50.0%

12 BACK TO Russia HIGHLIGHTS INVESTMENT BANKING LEAGUE TABLES PAGE

ANY INVOLVEMENT M&A LEAGUE TABLE (US$MIL)

RANK VALUE RANK VALUE YOY SHARE YOY #DEALS YOY Q1 2020 Q1 2019 BANK NAME SHARE (%) #DEALS (US$ Mil) CHANGE (%) CHANGE (%) CHANGE (%) 1 6 VTB Capital $ 2,901.4 304% 7% -52% 4 -20% 2 - Morgan Stanley $ 20.0 - 0% - 1 - - 1* Guggenheim Securities LLC ------1* ------1* BofA Securities Inc ------4* Citi ------4* Deloitte ------7* Sberbank CIB ------7* Renaissance Capital Group ------9 JP Morgan ------TOTAL $ 43,198.3 744% 182 -9%

TARGET M&A LEAGUE TABLE (US$MIL)

RANK VALUE RANK VALUE YOY SHARE YOY #DEALS YOY Q1 2020 Q1 2019 BANK NAME SHARE (%) #DEALS (US$ Mil) CHANGE (%) CHANGE (%) CHANGE (%) 1 3 VTB Capital $ 2,901.4 304% 7% -71% 4 -20% 2 - Morgan Stanley $ 20.0 - 0% - 1 ------TOTAL $ 43,030.4 1292% 169 -10%

13 BACK TO Russia HIGHLIGHTS INVESTMENT BANKING LEAGUE TABLES PAGE

ECM LEAGUE TABLE (US$MIL)

PROCEEDS PROCEEDS YOY SHARE YOY #DEALS YOY Q1 2020 Q1 2019 BANK NAME SHARE (%) #DEALS (US$ Mil) CHANGE (%) CHANGE (%) CHANGE (%) 1* 1 VTB Capital $ 250.0 -18% 20% -20% 1 -67% 1* 5* Goldman Sachs & Co $ 250.0 221% 20% 217% 1 0% 1* 8 UBS $ 250.0 274% 20% 270% 1 0% 1* - Morgan Stanley $ 250.0 - 20% - 1 - 1* 4 JP Morgan $ 250.0 104% 20% 102% 1 -50% ------0 0 0 $ - - % - 0 - TOTAL $ 1,250.0 1% 1 -75%

DCM LEAGUE TABLE (US$MIL)

PROCEEDS PROCEEDS YOY SHARE YOY #DEALS YOY Q1 2020 Q1 2019 BANK NAME SHARE (%) #DEALS (US$ Mil) CHANGE (%) CHANGE (%) CHANGE (%) 1 1 VTB Capital $ 2,652.0 -46% 33.6% -25% 15 -21% 2 2 Gazprombank $ 1,201.4 -54% 15.2% -36% 10 25% 3 4 JP Morgan $ 967.5 79% 12.3% 151% 5 25% 4 8 UniCredit $ 666.7 315% 8.4% 460% 1 -50% 5 3 Sberbank CIB $ 578.9 -38% 7.3% -15% 8 -33% 6 - Alfa Bank $ 352.4 - 4.5% - 5 - 7 15 Credit Bank of Moscow $ 296.9 172% 3.8% 280% 4 100% 8 9* Renaissance Capital Group $ 280.2 79% 3.6% 157% 4 300% 9 14 Citi $ 157.1 35% 2% 82% 2 100% 10 - UBS $ 143.7 - 1.8% - 2 - TOTAL $ 7,897.2 -28% 18 78%

14 BACK TO HIGHLIGHTS CONTACTS / GLOSSARY PAGE

ABOUT REFINITIV MERGERS & ACQUISITIONS Refinitiv, formerly the Financial & Risk business of Thomson Reuters, is one of the world’s largest The Refinitiv Mergers & Acquisitions database tracks changes in economic ownership at ultimate parent level in going providers of financial markets data and infrastructure. Serving more than 40,000 institutions in over 190 business concerns. All deals involving a purchase of at least a 5% stake, or 3% with a value of at least US$1 million are countries, we provide information, insights, and technology that drive innovation and performance in tracked, subject to criteria. League tables include rank eligible mergers, acquisitions, repurchases, spin-offs, self-tenders, global markets. Our 160-year Reuters heritage of integrity enables customers to make critical decisions minority stake purchases and debt restructurings. League tables, commentary, and charts citing announced activity are with confidence, while our unique open platform, best-in-class data, and cutting-edge technology bring based on Rank Date and include intended, pending, partially complete, completed, pending regulatory, and unconditional greater opportunity to our customers. By advancing our customers, we drive progress for the entire transactions. Rank Date is defined as the earliest public announcement of when a value can be applied to a transaction. financial community. For more information, go to www.refinitiv.com. EQUITY CAPITAL MARKETS The Refinitiv Equity Capital Markets database covers domestic and international placements of equity offerings in addition ABOUT DEALS INTELLIGENCE to domestic and international equity-related transactions. This includes IPOs, follow-on offerings, accelerated book builds Deals Intelligence, a part of Refinitiv Investing & Advisory division, brings up to the minute market and block trades (with certain restrictions) and convertible bonds. Convertible Bonds with a minimum life of less than 360 intelligence to the deal making community and the financial media through a variety of research reports days are excluded. Minimum life defined as the difference between the settlement date and the earliest maturity date or including Daily Deals Insight, weekly Investment Banking Scorecard, monthly Deals Snapshots and our first call/put option. industry-leading quarterly reviews highlighting trends in M&A and Capital Markets. DEBT CAPITAL MARKETS CONTACT INFORMATION The Refinitiv Debt Capital Markets database covers underwritten debt with an issue size of over US$1 million, that AMERICAS matures in at least 360 days from settlement. It includes all internationally offered underwritten debt transactions in all Matt Toole I +1 646 223 7212 I [email protected] currencies, Domestic issuance, Preferred Securities, High Yield and Emerging Market transactions that are offered in US and Globally, Asset Backed Securities, Mortgage Backed Securities, Collateralized Debt Obligations (CDOs), MTN EMEA takedowns and Certificate of Deposits, except in UK. Primary offerings only. All league tables are based on deal Lucille Jones l +44 207 542 4372 l [email protected] proceeds (total issue amount multiplied by the issue price) unless otherwise stated. Full credit is given to the book runner, equal if joint books. In cases of underwriter consolidation, credit is given to the surviving/parent firm. Non-US ASIA dollar denominated transactions are converted to the US dollar equivalent at the time of announcement. Elaine Tan l +63 (2) 459 1567 l [email protected]

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