Russia's UC Rusal slides in Hong Kong debut

"Russia's UC Rusal slides in Hong Kong debut | AboutHK.Com - More Information About HK"

Shares of Russian aluminum giant UC Rusal tumbled in their first day of Hong Kong trade Wednesday following a $2.2 billion initial public offering clouded by concerns over the company's massive debts.

Rusal's shares were nearly 11 percent down from their IPO price of 10.80 Hong Kong dollars ($1.38) by the close of trading.

The company's tycoon owner, Oleg Deripaska, Russia's richest man before the financial crisis, called the lackluster performance "reasonable" given recent declines in global markets.

The IPO attracted criticism that Hong Kong regulators were undermining the Chinese territory's credibility as a financial hub by allowing a company struggling with nearly $15 billion in debt to list shares.

Hong Kong, eager to broaden its limited role as a center for Chinese IPOs by attracting more foreign companies, declined the listing before reversing course. However, regulators imposed a host of restrictions on the offering that barred retail investors.

Deripaska, who presented Hong Kong's stock exchange with an aluminum Russian doll, said more Russian companies would turn to Hong Kong to raise capital.

"Growth in Asia ... will also create benefit in Russia," he said.

The company plans to use proceeds to pay down its debts.