Mdetalloinvest's stock sale will be the first complete IPO carried out by VTB.
Photo: Oleg Kharseev
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VTB Gets IPO
Alisher Usmanov’s metals and mining company Metalloinvest has chosen the underwriters for its initial public offering. Among them is VTB Capital, a subsidiary of VTB that was set up three months ago. This will be VTB’s first complete IPO underwriting. The global underwriters will be Merrill Lynch, Credit Suisse and Deutsche Bank. VTB Capital and Renaissance Capital will be the bookrunners (underwriters that maintain the books of securities sold for the issue). Sources say the IPO will be held in late October/early November on Russian stock exchanges and the London Stock Exchange. Vneshtorgbank provided Metalloinvest with $1 billion in credit to buy the Mikhailovsky Metals Combine in 2005.
Bankers say investors will be offered at least 10 percent of the authorized capital, which, depending on the assessment, could be up to $3 billion. According to UBS analytics department head Alexey Morozov, the company’s capitalization is currently $25 billion, and it could climb to $30 billion toward the end of the year as raw materials prices rise. There will be no additional stock issue. Current shareholders will sell their own stock. The Metalloinvest holding consists of the Lebedinsky and Mikhailovsky combines, the Oskolsky electro-combine and Urals Steel. It produces about 6 million tons of steel and 40 million tons of iron ore per year (40 percent of Russia’s production). Metalloinvest’s receipts are about $5 billion. Usmanov owns 50 percent of the holding through Gallagher Holdings Ltd. (He also owns Kommersant Publishing House.); another 30 percent belongs to Russian State Duma member Andrey Skoch, and 20 percent belongs to Vasily Anisimov.
Observers say the IPO is necessary for Metalloinvest for it to go ahead with its plans to merge with Norilsk Nickel. Metalloinvest and Interros have agreed on a joint mining and metals company formed around Metalloinvest and Norilsk Nickel, with Interros owning about 30 percent. Interros has already filed an application with the Federal Antimonopoly Service for the purchased of 25 percent plus one share of Metalloinvest.
www.kommersant.com
All the Article in Russian as of July 07, 2008
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