Nord Gold confirms postponement of London IPO

MOSCOW Fri Feb 11, 2011 2:49am EST

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MOSCOW (Reuters) - Russian mining group Severstal's (CHMF.MM) unit Nord Gold confirmed on Friday it had postponed plans for a $1.5 billion London IPO due to market conditions.

Market attention will now turn to Russian state-controlled lender VTB (VTBR.MM), which will close the books on a $3.6 billion secondary share offering later on Friday and was seen as a reason for the lower interest in the private listings.

Nord Gold's decision means that three of Russia's four IPO hopefuls so far this year have failed to attract enough demand from investors and canceled their plans.

"Although there was a lot of interest from the investment community in Nord Gold, we were not prepared to proceed with an IPO which did not fairly reflect the value of our assets," Nord Gold Chief Executive Nikolai Zelenski said in a statement.

The company had been hoping to raise up to $1.5 billion to pay debt to its parent company Severstal, Russia's biggest steel producer.

A source close to the deal told Reuters on Thursday that Nord Gold had decided not to go ahead with its IPO, following steel pipe maker ChelPipe and coking coal producer KOKS earlier in the week.

(Reporting by John Bowker, Editing by Toni Vorovyova)

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