CORRECT:Rusal Gets Hong Kong Regulator Approval For US$2 Billion Hong Kong IPO:Sources
18 Dicembre 2009 - 7:06PM
Dow Jones News
Russian aluminum company UC Rusal has gained listing approval
from the Hong Kong securities regulator on its planned US$2 billion
offering, allowing it to list in the city as early as the end of
January, people familiar with the situation said Friday.
But the green light was given on the condition that it won't
sell the deal to retail investors, in a bid to "protect" Hong
Kong's retail investors from the complexities of the deal.
Rusal, which has also applied for an IPO on the Euronext stock
exchange in Paris, earlier this month completed the restructuring
of US$7.4 billion in debt with more than 70 Russian and global
banks.
As a result of the agreement with banks, there won't be any
dividend payout for Rusal shareholders until its debt/Ebitda falls
below three.
Proceeds from the Paris and Hong Kong listings will be used to
help pay off creditors.
Friday's decision was reached after the Securities and Futures
Commission met earlier in the day to deliberate on the matter. The
SFC is a quasi-governmental securities regulator.
"The SFC decision of no offer to retail investors via the Hong
Kong public offering tranche does not have an impact on the
company's target institutional investor group as well as on its
listing plan and valuation," one person said, adding bookbuilding
for the IPO will kick off in early January as planned.
As a result of the condition, only institutional investors and
high-net-worth individuals who fulfill certain "investment
guidelines" can participate in the offering. The people familiar
with the situation didn't elaborate on the guidelines, only noting
the guidelines were "creative ways to discourage retail investors
from participating."
One such way would be to set the board lot size so large that
retail investors would be deterred by the high amount needed to buy
even one board lot of shares.
But three people said Rusal has already garnered "substantial
demand" for the IPO, with some committed as cornerstone investors.
The Hong Kong Stock Exchange's listing committee already gave a
conditional go-ahead for Rusal's offering Thursday, people familiar
with the situation said earlier Friday, as Rusal gave reassurance
that a US$4.5 billion loan, due in October next year, will be
refinanced.
People close to the company said Thursday that Sberbank Rossia
(SBRBF, SBER.RS), the state-controlled savings bank, agreed to
extend a multiyear loan to Rusal to allow it to repay a $4.5
billion rescue loan from another Russian state bank,
Vnesheconombank, or VEB.
-By Amy Or, Dow Jones Newswires; 852-2832 2335;
amy.or@dowjones.com
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