Client: Mobile TeleSystems
PR Team: Gavin Anderson & Company
Campaign: Launch of Mobile TeleSystems on the New York Stock
Timescale: May-July 2000
Budget: Around pounds 180,000
Mobile TeleSystems has been Russia's leading mobile operator since
The company was ready to be listed on the New York Stock Exchange (NYSE)
in 1998, but this was postponed after the economic crisis in August that
MTS's initial public offering (IPO), which occurred last May/June, was
the first by a Russian company since the crisis.
The IPO became viewed as symbolic of renewed investor interest in
It was said that future foreign investment into Russia would be affected
by the success of the offering.
The London-based offices of Deutsche Bank and ING Barings carried out
the flotation; the PR campaign was also run from the UK by Gavin
To demonstrate to international institutional investors the potential of
MTS and the general recovery of the Russian capital market. To work
within the strict rulings of the Security and Exchange Commission (SEC),
the US governing body of listings on the NYSE, making sure that neither
the company nor the global co-ordinators broke any regulations, which
would jeopardise the listing.
Strategy and Plan
The SEC scrutinised the MTS flotation because it was the first IPO out
of Russia since the collapse of the Russian market. Gavin Anderson had
to pay close attention to every detail of the dealings.
Russian-born Gavin Anderson associate director Marina Boughton led the
campaign to communicate MTS's economic indicators and growth potential
to the international investment community in order to maximise the
demand and the issue price.
Under SEC regulations, companies looking to float in the US are
restricted in what they can say to the US media so that they do not hype
up the offer.
Boughton had to ensure that both MTS management and global co-ordinators
conformed to all SEC rulings when dealing with the press and did not
initiate any direct contact with the US media. This could have resulted
in the IPO being postponed or even cancelled by the SEC.
At the same time, Gavin Anderson had to generate media coverage for the
offer, targeting investors based in Europe and elsewhere.
In the run-up to the IPO, Gavin Anderson helped MTS directors develop
their key messages to the media and trained them to deal with the
Western press, including the best way to explain the advantages of
communicating with the media. Gavin Anderson also helped MTS understand
the implications of listing.
The Russian press and international media were informed about the IPO at
a press conference in Moscow on 9 June; 70 journalists were present.
Briefs were sent to agencies such as Reuters and Associated Press.
Gavin Anderson drip-fed the press with regular updates on the IPO and
continued to stress MTS's strong financial and operational indicators.By
reporting the latter, Gavin Anderson was able to demonstrate that MTS
was a strong investment case and a must for any investor looking for
higher exposure to the recovering Russian equity market.
Measurement and Evaluation
The Financial Times followed the whole process, as did the Wall Street
Journal, which also ran a feature entitled 'Mobile TeleSystems start IPO
roadshow; New York listing a test for Russian shares'.
On 30 June, MTS was successfully listed on the NYSE. All main news
agencies and financial publications, including the FT, WSJ, New York
Times, Public Network Europe and International Financial Review reported
the event. All the coverage was positive.
MTS was listed on the NYSE on 30 June with an issue price of dollars
21.50 per ADR (American Depository Receipt). The offer was
six-and-a-half times oversubscribed and the price peaked at more than
pounds 17 on the first day. MTS is currently trading at around pounds