Mechel Mining asks for permission for IPO

Mechel Mining, an ore mining subsidiary of Russia's leading metals company Mechel, has filed a request to hold an Initial Public Offering abroad, the company said on Wednesday. A banking source told RIA Novosti in July that Mechel Mining planned to hold the IPO this fall on the London Stock Exchange. JP Morgan, Morgan Stanley and UBS were chosen as underwriters of the issue, which may amount to 10-15 percent of company's equity capital. This Monday, Mechel Mining signed an agreement with Luxemburg's The Bank of New York Mellon without date to service a deposit program and issue Global Depositary Receipts. Uralsib analysts believe that the IPO might be held this October or November on the LSE, but the current turmoil on the stock and raw materials markets creates some uncertainty about a possible date of the float. Banking sources have previously said the company planned to raise over $1 billion in a share sale in London. Troika Dialog investment house valued the company at $18-19 billion. In July, Mechel Mining initiated a new share issue amounting to 25 percent of the company's equity. The additional issue may bring Mechel Mining about $3.3-4 billion including discount.