Thursday 3 June 2021 9:24 am

Russia's Nordgold plots London IPO after gold price climb

Russian mining giant Nord Gold has confirmed its plans today to hold an initial public offering (IPO) in London, after reaping the benefits of rising gold prices.

The company, known as Nordgold, is plotting a free float of at least 25 per cent while it also plans another listing in Moscow, the group said today.

Investor interest has climbed alongside gold prices, which hit a record high last year.

Nordgold has not yet revealed a price, but it is believed to be worth around £3.5bn, the Wall Street Journal first reported.

“Following a record year in 2020, and with a low cost, low-risk development pipeline centred on the highly prospective gross region in Russia, now is the right time for Nordgold to seek a premium London listing,” CEO Nikolai Zelenski said in a statement.

Bacchus Capital Advisers will financially advise on the IPO, while Citigroup will sponsor the offer.

The IPO will also enlist the help of Citigroup, JPMorgan Chase & Co. and VTB Capital to coordinate and book run the sale.

“Now is the right time for Nordgold to seek a premium London listing,” Zelenski added. “We look forward to sharing our story with potential investors over the coming weeks.”

A family affair

Although the miner will not sell new shares, an IPO would open up options for lifting capital which would help the company to keep key managers.

The mining giant, controlled by Russian billionaire’s Alexey Mordashov’s family, pulled out of London’s stock market in 2017, after the board agreed investors were not valuing the listing enough.

The billionaire since gifted 65 per cent of Nordgold to his two eldest sons in 2019, which a spokesperson for the family said was a “technical deal”.