LONDON-listed Indian miner Vedanta has delayed an initial public offering (IPO) of its Zambian copper business until next year, citing stock market volatility.
It is the first big European IPO to fall victim to a renewed wave of financial market turbulence brought on by the Irish debt crisis.
Earlier this month, Vedanta announced plans to list Konkola Copper Mines (KCM), the second-biggest integrated copper producer in Africa, selling new and existing shares to raise about $1.1bn (£710m) to be used by KCM to boost output.
Kishore Kumar, chief executive of KCM’s holding company Konkola Resources, had said the London listing was expected next month, while a source close to the deal had said final pricing was expected in mid-December.
But the company said yesterday the listing was not expected before next year.
“With year end approaching and the current stock market volatility, the boards of Vedanta Resources and Konkola have decided to pursue such a listing in 2011,” it said.
After a relative resurgence in European offerings in October and early November, supported by stock markets trading at two-year highs, concerns over Eurozone debt following Ireland’s bailout have increased market turbulence.
The IPO market is also winding down. No further new deals are likely to be launched this year as there would not be enough time to complete the usual month-long process and allow newly listed shares to trade properly before the Christmas break.
Shares in Vedanta, which also plans to list its Indian Sterlite Energy commercial power generation subsidiary, fell sharply following the announcement but recovered some losses to close 1.2 per cent lower at 1,986p.
City A.M. Reporter