13. MegaFon goes to London (beginner). On November 28, 2012, MegaFon – the Russian telecom company – raised £1 billion on the London Stock Exchange.

The controversial Uzbek oligarch Alisher Usmanov owns 55.8 percent of Mega-

Fon, which is the no. 2 Russian mobile phone operator company behind Mobile TeleSystems (MTS) but ahead of VimpelCom. Both MTS and VimpelCom are listed on the New York Stock Exchange.

a. The stock issue was in the form of global depositary receipts at £20 per GDR.

If MegaFon shares on the Moscow Stock Exchange are defined as five shares for one London GDR and the spot price prevailing on that day was RUB 49.47

= £1, at what RUB price were MegaFon shares trading in Moscow?

b. Why do you think that MegaFon chose London rather than New York for its foreign listing debut?