OAO Severstal’s gold-mining unit isseeking regulatory approval for a $1 billion initial publicoffering in London, according to three people with knowledge ofthe plan.
The IPO, managed by Credit Suisse Group AG, Morgan Stanleyand Troika Dialog, may start as early as this month, pendingapproval from regulators in London, two of the people said,declining to be identified because the information is private.The gold unit, Nord Gold NV, will be valued at $4 billion to $5billion after the sale, the people said.
The IPO, if successful, would be London’s biggest sinceNathaniel Rothschild’s mining fund Vallar Plc raised $1 billionin July. The sale would also be the largest overseas shareoffering by a Russian company since Moscow-based United Co.Rusal raised $2.24 billion in Hong Kong in January.
Sergey Loktionov, a spokesman for Severstal Resources,declined to comment.
Nord Gold may produce 640,000 ounces to 670,000 ounces ofthe precious metal in 2010, up from 528,700 ounces last year,Severstal said Sept. 14. The unit’s first-half earnings beforeinterest, tax, depreciation and amortization rose 41 percent to$156 million, while sales gained 61 percent to $301 million.
Severstal has spent about $1.2 billion on gold acquisitionssince 2007, the company said in a presentation in July. Goldoperations accounted for 10 percent of overall Ebitda in thefirst half.
Mail.ru Group Ltd., a Russian internet holding companypart-owned by billionaire Alisher Usmanov, also plans a LondonIPO by the end of the year, it said in a filing this month.
To contact the reporters on this story:Zijing Wu in London atzwu17@bloomberg.net;Ilya Khrennikov in Moscow atikhrennikov@bloomberg.net.
To contact the editors responsible for this story:Daniel Hauck at dhauck1@bloomberg.net;Amanda Jordan at ajordan11@bloomberg.net.