Russian iron firm plans London IPO

RUSSIA’S biggest iron ore producer is planning to sell 20 per cent of its shares on the London Stock Exchange, valuing the company at £12.3bn.

Metalloinvest, which is half-owned by oligarch Alisher Usmanov, could be launched into the FTSE 100 by the listing.

The company has appointed Deutsche Bank, Merrill Lynch and Credit Suisse to handle the offering.

Usmanov, who owns part of Arsenal football club, listed Mail.ru – the Russian social networking site – in London for £570m.

The move comes after a turbulent period for Russian companies looking to list in London.

Three initial public offerings by Russian-based firms were pulled last week as a result of tough market conditions.

Nord Gold, the mining unit of steel giant Severstal, was the biggest firm to scrap plans for an initial public offering (IPO) last week.

The miner, led by billionaire Alexay Mordashov, had been looking to raise up to $1bn (£622m) to pay down debt and make new acquisitions.

Steel pipe maker Chelpipe pulled the plug on a $688m IPO attempt whilst coking coal producer Koks cancelled a $500m effort.

Pump manufacturer HMS Hydraulic was forced to cut its price range in order to list in London.

It will now raise just $360m, as opposed to between $396m and $580m as originally planned.

Unrest in Egypt had hit emerging markets (EM) funds as investors pulled more than $7bn in the week to 2 February.

The firms had hoped investors in EM would become shareholders.