Russian mining biggies eyeing return to London stock market

Bloomberg

For three years, Russian companies retreated from the London stock market. Now, a pair of oil and mining billionaires is hoping to break the drought.
En+ Group Ltd., owned by aluminum magnate Oleg Deripaska, and Polyus PJSC, a gold producer controlled by the family of Suleiman Kerimov, are planning to sell shares in May or June. If successful, they could raise as much as $3 billion in London and Moscow.
The deals will test investor appetite for Russian assets after a rally in share prices, driven by the commodities recovery and expectations of receding tensions between Moscow and the US. While there have been some secondary share sales in London, including by Novolipetsk Steel PJSC in December, En+ and Polyus would be the first Russian companies to join the London exchange since 2014, according to London Stock Exchange data.
“Investors’ interest to Russia was super high at the start of the year. Now, it is a bit smaller, but still impressive,” Kirill Chuyko, chief strategist at BCS Global Markets in Moscow, said by phone. “Companies want to cash out this situation.”
Russian companies pulled out of international markets in recent years due to sanctions, weak commodity prices and support from the Kremlin to move listings to Moscow. Uralkali PJSC and Eurasia Drilling Co. quit the London market in 2015, and gold miner Nordgold SE delisted in March.

ROADSHOW PLANS
En+, which owns hydro-power plants, coal mines and a stake in United Co. Rusal, aims to raise up to $2 billion by selling as much as a 25 percent stake in London and Moscow. The company may start planning for a roadshow in May and a sale the following month, depending on market conditions, people familiar with its plans said.
For Polyus, the sale would mark a return to London. Its parent, Polyus Gold International Ltd., delisted from London in late 2015 after the Kerimov family bought up shares amid plans to domicile the firm in Russia. The company is now planning to offer a stake of up to 10 percent to investors in London and Moscow worth $1 billion in May or June.
“Both are sizable offerings and will require more than domestic demand to be successful and achieve valuation targets,” said Sergei Chinkis, head of global mining and metals at Scotiabank. “London listings, rightly or wrongly, are believed to have higher corporate governance standards, investor following, and hence, a wider demand.”