MOSCOW (Reuters) - Debt-laden Russian tycoon Oleg Deripaska is planning to list a power firm in Hong Kong, banking sources said, weeks after his aluminum company RUSAL’s IPO left investors nursing hefty losses.
January’s initial public offering (IPO) in Hong Kong of around a tenth of RUSAL -- the world’s top aluminum firm in which Deripaska holds a major stake -- raised $2.2 billion to pay ($4.18 billion) down debt.
But its shares have since dropped around 22 percent from the IPO price because of global market jitters, renewed investor aversion to risky assets.
RUSAL was the first non-Asian company to float in Hong Kong, and now Deripaska, Russia’s most indebted oligarch, is looking to list En+ Power -- currently called EuroSibEnergo -- the two banking sources said. One of the sources said the listing would aim to raise $1 billion.
An En+ Group spokesman said the group was considering IPOs for many of its assets but would not comment on concrete plans.
One Moscow-based fund manager, who declined to be named, said a second attempt by Deripaska at a Hong Kong listing after the performance of the first would be “absurd.”
“The optimism once held by Russian companies - fueled by investment banks -- that they can list in Hong Kong and get a premium has been rendered moot,” he told Reuters. “The RUSAL price and relative lack of liquidity should have woken the market up to that fact.”
Separately, Viktor Vekselberg, another key RUSAL shareholder, told Russia Today television he would target Hong Kong for an IPO of his Kamchatka Gold miner later this year.
“Absolutely, the project is a very logistical development with Chinese participation, it will be the right place to make an IPO on the Hong Kong stock exchange for the end of the year, fourth quarter,” Vekselberg said.
The RUSAL IPO was expected to trigger a stampede of Russian companies to Hong Kong, but recent events have made investors more skeptical.
The En+ official said En+ Power has debts of around $1.5 billion maturing in 2015.
It is the power division of Deripaska’s energy holding company En+ Group, which restructured around $1 billion of debt this year and will have to pay back the borrowings by the end of 2013.
An IPO of the power division would echo the path to market taken by RUSAL, its biggest customer, which restructured a $16.8 billion debt pile in late 2009.
En+ Power operates 14 power stations located in Siberia -- including the Krasnoyarsk and Bratsk hydroelectric power plants, ranked among ten biggest in the world -- and the Volga region with total established capacity of approximately 19,500 megawatt.
EuroSibEnergo would switch to the name En+ Power for the IPO, the sources said. The group’s 2009 revenue came in at 76.2 billion roubles ($2.5 billion).
Writing by John Bowker and Dmitry Zhdannikov, editing by John Stonestreet and Karen Foster