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Rusal seeks to raise $2.6 billion in Hong Kong IPO

Rusal seeks to raise $2.6 billion in Hong Kong IPO

Russian aluminum giant UC Rusal will try to raise as much as $2.6 billion by selling shares listed in Hong Kong to reduce its mountain of debt, the company said Friday.
But the initial public offering will come with a host of restrictions on who can by the shares and how they're traded, reflecting the concerns of regulators about Rusal's $14.9 billion debt load.
Moscow-based Rusal _ run by tycoon Oleg Deripaska _ is seeking to sell more than 1.6 billion shares at a price between $12.50 Hong Kong dollars ($1.61) and HK$9.10, according to a filing with Hong Kong's stock exchange.
The company said it plans to use all proceeds to "reduce outstanding debt and to satisfy other obligations to its creditors."
The IPO has attracted controversy, with critics accusing regulators of undermining Hong Kong's credibility as an international financial center by allowing a company so heavily in debt to list. The city's stock exchange initially declined to approve the listing before reversing course.
Regulators seemed to strike a middle ground by limiting the IPO's buyers.
According to Friday's filing, it's not open to retail investors, only buyers designated under local regulations as "professional investors" or willing to purchase at least HK$1 million ($129,000) in shares. To start, shares will only be traded in blocks worth nearly $26,000.
Earlier this year, Rusal announced a landmark deal to restructure its debt as it sought to go public in Hong Kong by the end of the year.
Deripaska, once Russia's richest man, is estimated by Forbes magazine to have lost some $24 billion of his fortune during the financial crisis.


Updated : 2021-01-20 06:48 GMT+08:00