Listing and information disclosure

1
Listing and information disclosure December
2005
2
Agenda

• The London markets and Russia
• Why consider accessing the international capital
  markets?
• Why Londons Main Market?
• Range of markets
• Flexible regulation
• Access to capital
• Access to liquidity
• AIM the benefits of accessing the worlds most
  successful growth companies market
• Case studies
• Questions?

3
Companies on the London Stock Exchange CIS focus

• 22 Companies traded on the LSE Main Market
• In 2004, the total trade volume in Russian DRs
  was over US63.96bn
• Privatisation expertise in London
• Balanced approach to corporate governance
• Gateway to European consumers and investors

Source London Stock Exchange trade statistics
4
Companies listed in London, Main Market
AO TATNEFT GAZPROM LUKOIL OMZ EFES
Breweries International SISTEMA PYATEROCHKA
EVRAZ Group NOVATEK AMTEL VREDESTEIN KAZKOMM
ERTSBANK KAZAKHMYS KAZAKHGOLD GROUP
Companies traded in London, Main Market
MMC NORILSK NICKEL SURGUTNEFTEGAZ WIMM BILL
DANN FOODS UNIFIED ENERGY SYSTEMS OF
RUSSIA YUKOS
AO MOSENERGO ROSTELEKOM SIBNEFT MOBILE
TELESYSTEMS OJSC
Source London Stock Exchange trade statistics
5
Companies on AIM with CIS focus -22 companies
ARICOM ORIEL RESOURCES AVOCET MINING
PALLADEX CARDINAL RESOURCES PETER HAMBRO
CELTIC RESOURCES RAMBLER MEDIA EUREKA
MINING RAVEN RUSSIA FRONTIER MINING
REGAL PETROLEUM HAMBLEDON MINING SIBIR
ENERGY HIGHLAND GOLD TRANS SIBERIAN KRYSO
RESOURCES UKRPRODUCT NELSON RESOURCES
URALS ENERGY OXUS GOLD VICTORIA OIL
Source London Stock Exchange trade statistics
6
CAPITAL Case study - Main Market GDRs
Sistema
Transaction Synopsis Date of Admission 14
February 2005 Market Main Market
Transaction Placing Money raised
1.56 billion Turnover (first 11 days) 2.54
billion FTSE Classification Diversified
Industrials
Sistema is the largest Russian IPO ever and
the biggest international IPO on the London
Stock Exchange since Orange in 2001.
Core business activities Sistema is the largest
private sector consumer services company in
Russia and the CIS, with over 35 million
customers. Founded in 1993, the company reported
revenues of US 4.1 billion for the first nine
months of 2004 and total assets of US 7.7
billion.
London is a major capital markets center and the
choice of the London Stock Exchange reflects our
desire to attract a broad institutional
shareholder base, as well our strategic
partnerships with leading global companies based
in Europe. Vladimir Evtushenkov, President of
Sistema
7
London has the widest choice of proven markets
globally
A choice of globally respected markets supported
by a wide range of institutional retail
investors
Main Market

Supports the capital raising activities of more
established companies seeking further
growth. 1,696 issuers
Supports the capital raising activities of
earlier stage companies in their initial growth
period. 1,332 issuers
No other Exchange globally can offer the same
choice of markets with the same breadth and depth
of investors
Source London Stock Exchange October 2005
8
Key differences between our markets

• Regulation by the LSE
• No trading record required
• No minimum amount of shares to be in public hands
• In most cases, no prior shareholder approval
  required for transactions
• Normally, admission documents not pre-vetted by
  Exchange or UKLA but by nominated adviser
• Nominated adviser required at all times

• Pre-vetting of admission documents by the UKLA
• Compliance required with the rules of the UKLA
• Normally a three-year trading record required
• Minimum of 25 shares in public hands
• Prior shareholders approval for certain
  transactions
• Sponsors needed for certain transactions

Main Market
AIM and Main Market are structured differently to
assist different types of companies
9
London has an intelligent approach to regulation
Less
More
Balance Competing Needs
Companies
Investors
Minimise the cost and hassle of the regulatory
framework
Maximise the protection inherent in the
regulatory framework

• UK is more flexible as it is based on sound
  principles (comply or explain) and effective
  codes, whereas the US is prescriptive, costly and
  expensive
• UK had the highest standards of corporate
  governance in the world for 5 consecutive years
  (1996 2000 survey by Davis Global Advisors)

• Investors willing to pay 12 14 premium for UK,
  US and EU companies with good governance
  (McKinseys Global Investor Opinion Survey)

Alan Greenspan, chairman of the US Federal
Reserve, has hailed the success of London in
staying at the top of the worlds financial
pyramid
Greenspan praises Londons success story by Ed
Crooks, FT, 25 September 2002
10
MM CONTINUING OBLIGATIONS

• WHAT ARE THE DISCLOSURE RULES?
• Overall purpose to implement a pan-European
  standard for the disclosure of inside information
• Implementation of the provisions of the Market
  Abuse Directive (MAD) in relation to
• - Disclosure of Inside Information by companies
• - Notification of share dealings by Directors and
  senior management
• - Insider lists

Source London Stock Exchange trade statistics
11
MM CONTINUING OBLIGATIONS

• WHO DO THEY APPLY TO?
• Issuers whose financial instruments are admitted
  to trading on a regulated market
• Persons Discharging Managerial Responsibilities
  and connected persons

Source London Stock Exchange trade statistics
12
MM CONTINUING OBLIGATIONS

• WHO HAS TO NOTIFY DEALINGS?
• the PDMR must notify the issuer in writing of
  transactions conducted on their own account in
  the shares of the issuer (within four business
  days of the date of the transaction)
• a connected person must notify the issuer as well
• the issuer notifies the market
• Who is a DIRECTORS AND PERSONS DISCHARGING
  MANAGERIAL RESPONSIBILTIES PDMR?
• a Director of an issuer
• a senior executive of an issuer with regular
  access to inside information

Source London Stock Exchange trade statistics
13
OTHER DISCLOSURE POINTS

• WHAT, WHEN, HOW AND WHERE TO ANNOUNCE
• information required by the Listing Rules and
  Disclosure Rules
• as soon as possible
• announce to the market via an RIS
• Inside Information announced via a RIS must be
  put on the issuers internet site (if it has one)
  the day after the announcement was made

Source London Stock Exchange trade statistics
14
AIM - Continuing Obligations
AIM companies are subject to the AIM Rules which
outline the continuing obligations of being on a
public market. Some of the key continuing
obligations are
AIM companies must have a Nomad at all times,
otherwise they will be suspended from the market
AIM companies must disclose all price sensitive
information in a timely manner including
substantial transactions, related party
transaction, reverse takeovers and other
miscellaneous transactions
Half Yearly and Annual Report and accounts
required in adherence with deadlines
All directors accept full responsibility,
collectively and individually for the AIM Rules
Restrictions on deals for directors and
applicable employees on AIM securities during
close periods
15
Case study Russian AIM Company, Peter Hambro
Mining Plc
PETER HAMBRO MINING Core business
activities Peter Hambro Mining Plc has 10 gold
sites, two of which, Pokrovskiy and Pioneer are
in production. Pokrovskiy is where Peter Hambro
Mining Plc started mining and produced its first
gold in 1999. It is approximately 320 km
north-northwest of the regional capital,
Blagoveschensk, and 50 km north of the border
with China. Pioneer entered production this year
and is located approximately 40 km from
Pokrovskiy. Peter Hambro Mining Plc is involved
in the mining of gold ore and the production of
dor bars which are sent for refining into London
Good Delivery bars of gold and silver at a
refinery in Krasnoyarsk. Most of the gold is
currently sold to Sberbank in Moscow and the
silver is sold to other banks in Russia. Under
Russian law, the group has the right to export
its product, once refined, to be sold for hard
currencies.  
Transaction Synopsis Date of Admission
29 April 2002 Market AIM Transaction
Placing Market Cap. at admission US67m
Capital raised initially
US20.3m Mkt. Cap. as of 6 Sept.2005
US1.09bn FTSE Classification Gold Mining

16
Russian/CIS website
www.londonstockexchange.com/ru
www.londonstockexchange.com/ru/AIM