Kazakh mining firm Eurasian plans 2007 IPO

/REUTERS, London, March 16, 06/ - Kazakh mining firm Eurasian Industrial Association on Thursday announced plans for an initial public offering in 2007, saying it was raising funds to finance a series of global acquisitions in the sector. Company President Alexander Mashkevich told reporters that up to 25 percent of Eurasian, a leading producer of alumina, chrome and iron-ore, could be floated in London next year, but declined to say how much he hoped to raise from the deal. "I am announcing this officially. We plan to have an IPO in London in 2007," Mashkevich said on the sidelines of an investment conference in London. "We hope that this will be successful and attractive to investors because of our diversified portfolio of projects and all the projects that we have in our hand," he added. Eurasian's holding company, ENRC, recently sold a 25 percent stake to the chairman of another Kazakh mining firm, London-listed Kazakhmys, for $751 million -- a deal that Mashkevich said was also part of the group's funding plans. Speaking in Russian, Mashkevich said the company plans a slew of global acquisitions in the mining sector within Kazakhstan as well as in Russia and elsewhere. "We definitely have acquisition plans. We will announce the plans later this year," he said, adding that the acquisition of Russian (ferro-alloys producer) Serov should be concluded "within days." ENRC is the holding company for the firm which runs Alyumini Kazakhstan, an alumina producer in the central Asian state and Sokolov-Sarbai GOK, a big iron ore supplier to Russia and China, and a number of other metals companies. Mashkevich, who recently entered the Forbes list of billionaires, is one of the three main shareholders in Eurasian along with central Asian businessmen Patokh Shodiyev and Alidzhan Ibragimov. "Over the next two to three years we hope to complete a series of projects and embark on large new ones," he said. "That is why we are going for an IPO -- to attract more funds." Mashkevich said an aluminium smelter project in Pavlodar, northern Kazakhstan, is on track for completion in 2007. The project, whose total cost is estimated at $850 million, will produce 125,000 tonnes per year of primary aluminium in the initial phase but will later ramp up to 240,000 tonnes per year. Mashkevich said Eurasian was not interested in partnering Russian aluminium firm RUSAL in building a 500,000 tonne smelter in Kazakhstan, having instead sold a 31.7 percent stake in the Pavlodar plant to Swiss firm Corica AG. "We'd prefer to go it without RUSAL, though obviously we shall continue supplying their plants in Russia," he said. Eurasian made net profits of $730 million last year on turnover of $2.5 billion, Mashkevich added. Eurasian is the latest Kazakh corporate to jump on the IPO bandwagon, following successful share listings by mining firms Kazakhmys and KazakhGold last year. State-run oil firm KazMunaiGas and a number of leading banks are also preparing to list shares abroad as they try to boost their capital base. International investors, attracted by Kazakhstan's roaring double-digit economic growth, are keen to buy shares, especially in oil and mining companies. Another Kazakh firm, gold producer Charaltyn, also plans to issue shares via a Toronto IPO by the end of 2006, company President Baltabek Mukashev told reporters at the same conference. Charaltyn, which aims to produce 70,000 ounces of gold in 2006, is owned mainly by Kazakh investors, though Russian investment firm Access-Renova owns a 24.9 percent stake. [2006-03-17]