A US-British asset management giant and a Chinese sovereign wealth fund have agreed to take part in the Hong Kong initial public offering (IPO) of the world’s largest aluminum producer, UC Rusal, a report said yesterday.
Black Rock and China Investment Corp (CIC, 中國投資公司) have given their initial agreement to take part in the IPO along with Russian state banks whose interest was already confirmed, daily Vedomosti said.
Quoting bankers close to the operation, the newspaper said that Rusal directors had late on Wednesday agreed on a valuation for the Russian metals giant of US$16 billion to US$22 billion for the IPO.
Vedomosti said this would make Rusal — whose majority shareholder is the oligarch Oleg Deripaska — the largest aluminum firm worldwide by capitalization, ahead of US firm Alcoa, which is valued at US$15.9 billion.
Sources said earlier this month that Rusal won conditional approval for the IPO from the Hong Kong bourse, ending weeks of uncertainty over whether its billions of dollars of debt would thwart the plan.
Rusal plans to float 10 percent of its shares valued at around US$2 billion in by far the biggest IPO by a Russian company since the economic crisis.
Vedomosti said Rusal was now planning to set the IPO price and complete the transaction by Jan. 20.
Pre-marketing will start on Jan. 5 and a roadshow on Jan. 11.
Around one-third of the shares will go to Europe-based funds and another third to Chinese funds. The Hong Kong bourse is not expected to allow private investors to take part.
The involvement of investors like Black Rock — which has US$1.44 trillion of assets under management — should attract smaller funds and mean Rusal has no problem attracting interest in the IPO, Vedomosti said.
Rusal and Black Rock declined to comment, Vedomosti said.
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