In the fall of 2013, Eurasian Natural Resources Corporation shares had been delisted from the London and Kazakhstan stock exchanges, and then ENRC was transferred from a public to a private company.
ENRC represents the main business assets of the “Eurasian trinity”, which includes Alexander Mashkevich, Alidjan Ibragimov and Patokh Shodiev, as well as the government of Kazakhstan – all of them constitute a consortium of the main owners of securities. Prior to delisting, they owned almost 54% of the company’s assets.
Alidjan Ibragimov: what is delisting and how did it affect the liquidity of the company’s shares
Alidjan Ibragimov said that delisting of ENRC shares from the Kazakhstan and London exchanges means that now they will not be sold there, i.e., quoted. And this, in turn, will affect their liquidity, that is, the ability of holders to sell them for no less than the buying prices with dividends.
That is why, back in the summer of 2013, the majority owners of the company’s securities, including Alidjan Ibragimov, offered the owners of minority assets to buy their shares back as quickly as possible. For each share, the majority shareholders proposed $2.65 and 0.23 for the shares of Kazakhmys. The interest of the shareholders’ to sell shares as soon as possible was primarily motivated by the fact that at the end of the listing of the company’s shares on the stock exchanges, their price would rapidly decrease, meaning that, the liquidity would be lost.
Alidjan Ibragimov, together with his business partners, rated each share at the price of 2.34 pouds per each. The total cost of entire ENRC, according to the estimates of the majority and financial experts for 2013, amounted to 3,043 billion pounds.
The decision on delisting in the capital of Foggy Albion began to take effect in November 2013, that was, three weeks after the official documentation was submitted to the officials of Great Britain. At that same time, the listing of ENRC in Kazakhstan was suspended. Three quarters of the shareholders voted to resell the shares back to the majority. By the end of October 2013, they bought back about 97% of the securities.
Alidzhan Ibragimov, together with his business partners, began negotiations with minority shareholders and decided to delist after they found out about an anti-fraud investigation in the spring of 2013 held by the service opposing major financial fraud in the UK.
ENRC is a reputable multinational company engaged in the extraction, processing and enrichment of various minerals. In addition, the organization is one of the leading suppliers of electric energy in the Republic of Kazakhstan.
Alidjan Ibragimov talks about how ENRC was created
Alidjan Ibragimov began his seniority in Uzbekistan early as a teenager. The first job of the future billionaire was the production of adobe, that is, clay bricks. Later, the future co-founder of a large business worked in various offices that were engaged in producing semimanufactures. For example, he put together wooden boxes for collecting and storing fruits. At that time, as a teenager, he received a decent monthly pay in the amount of 60 rubles.
Alidjan Ibragimov from his young age was fond of sports and reading books. He was a sociable and friendly person. Alexander made an acquaintance with one of the future founders of ENRC, Mashkevich Alexander, in 1971 during the wedding ceremony of one of the distant relatives. Eventually, their friendship will turn 50 in a year! The future Uzbek entrepreneur met Shodiev Fattah in 10 years.
ENRC was created by Alidjan Ibragimov, Alexander Mashkevich and Patokh Shodiev in 1994. By that time, everyone had considerable experience working as managers and entrepreneurs. The international company gradually grew, gaining production and financial turnover.
The first years of entrepreneurship were not easy for the entire “Eurasian trinity”: they literally lived in factories, which they pulled out of bankruptcy with all possible forces. At the same time, they tried to keep the staff of the enterprise at all costs. This approach seems to contradict all the tenets of capitalism. Nevertheless, at that time the titans of the Kazakhstani business realized that it was precisely qualified personnel that largely determined the stable growth of their manufacturing enterprise.
It is highly probable that the ENRC delisting is also partly connected to negative political events among the geographical neighbors of Kazakhstan. Including sanctions against the Russian Federation and a decrease in the debt financing market. Banks of the Russian Federation are the largest financial partners of the company. The decline in economic growth in China also had a negative impact: this state is the key market for selling raw materials produced by ENRC.
Despite all these adverse events, ENRC managed to maintain the same EBITDA in 2014 as in the previous year. Periodically, rumors appear in the media about the sale of ENRC, and its co-founders themselves do not exclude this, but specific actions in this direction are not taken. The “Eurasian troika” does not intend to transfer its brainchild to someone else’s possession at a low price.