Industrial giant RHI Magnesita shrugs off Brexit with new London listing

Courtney Goldsmith
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RHI and Magnesita completed a merger ahead of the listing (Source: Getty)

Refractory products maker RHI Magnesita will launch a premium listing on the London Stock Exchange tomorrow in a vote of confidence for the City post-Brexit.

The listing comes after a merger today between Austria's RHI and its Brazilian rival Magnesita, which together will generate revenues of around €2.5bn (£2.2bn). They expect to become an industry leader with a market capitalisation of more than £1bn.

RHI Magnesita makes bricks that line industrial furnaces to protect the expensive machinery from extremely high temperatures with heavyweight customers including Arcelor Mittal, Thyssenkrupp, BHP Billiton and Rio Tino.

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Stefan Borgas, chief executive of RHI and designated boss of RHI Magnesita, told City AM the two companies had outgrown their capital markets in Austria and Brazil. They looked to London because they felt the market had a good understanding of the industry, and many of their clients and rivals were listed on the LSE.

However, Brexit came up as a concern.

"We asked ourselves is this the right time now to come to the UK?" Borgas said.

"We took a deep dive," he said, explaining that he believes London's stock market will "not be affected at all" by Brexit.

"London's an extremely international market and we believe it will continue to be."

Yesterday was RHI's final day of trading on the Vienna Stock Exchange, and its shares closed at €35.90.

Following the merger and listing, RHI Magnesita plans to continue growing through expanding its product portfolio, boosting its presence in neglected regions like China, southeast Asia, Africa and Russia, and putting funds made available through synergies towards new technologies.

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