Floodgates may open again if sale is success

WHEN state oil giant Rosneft listed shares on the London Stock Exchange in 2006, it sent a clear signal that Britain’s financial markets were well and truly open to Russian business.

It triggered a gold rush as huge companies that were controlled by the state in the Soviet era were sold off in London which became the destination of choice for the Kremlin to sell shares in its companies to international investors.

Fast-forward 13 years and the situation is far less clear cut. Tensions between the UK and the Kremlin are, to put it mildly, strained – and the flood of Russian companies coming to the London markets has turned into just a trickle.

It has been 18 months since Oleg Deripaska floated energy giant En+ in London in the largest listing of a Russian company since 2012.

The Kremlin’s alleged role in the poisoning of the Skripals last year put the brakes on Russian money coming to London. But with the imminent arrival of Rustranscom on the stock exchange, all that could change. The share sale will be the litmus test of whether Russian money really is welcome again in London, which has been temporarily starved of flotations in general thanks to Brexit uncertainty. If it is well received, the floodgates may open again.