Bruce Einhorn, (Bloomberg)
Hong Kong should make it easier for investors to trade in shares of United Co. Rusal Ltd. to entice more Russian companies to sell stock in the city, said Andrei Kostin, the head of Russia’s second-largest bank.
“There’s a growing interest among Russian companies to place shares on the Hong Kong stock exchange,” VTB Bank President and Chairman Kostin said in an interview in Hong Kong today. VTB was one of the banks managing the January initial public offering of Rusal.
Rusal, the first Russian company to list in Hong Kong, had its offering delayed at least twice by regulators and restricted to wealthy and corporate investors on concern about its debt. The stock, which has slumped 37 percent since its listing, trades in blocks of 24,000 shares.
“I understand that authorities want to protect unprofessional investors when talking about unknown territory like Russia, but sooner or later, Russian companies should be treated the same way as other companies,” Kostin said. “There should be some sort of compromise.”
Rusal, controlled by Russian billionaire Oleg Deripaska, fell 2.7 percent to HK$6.81 in Hong Kong trading today, from the listing price of HK$10.80.
About 4.1 million Rusal shares have been traded daily on average during the last three months, Bloomberg data show. By contrast, an average of about 38.4 million shares of Aluminum Corp. of China Ltd., the country’s largest producer of the light metal, changed hands every day during the same period.
Kostin said he has met with Hong Kong Exchanges & Clearing Ltd. Chairman Ronald Arculli and Hong Kong Chief Executive Donald Tsang on his visit to the city and told them regulators should ease those restrictions that applied to Rusal when the aluminum producer listed.
VTB, based in Moscow, is looking for a manager to run its Hong Kong office to meet increased demand from Russian companies that want to have listings in the city, Kostin said.
Rusal, barred from marketing to retail investors, found buyers for all the stock on offer after winning investments from Asian billionaire Li Ka-shing and New York hedge-fund manager Paulson & Co.
BNP Paribas SA and Credit Suisse Group AG led banks including Bank of America Merrill Lynch, BOC International Holdings Ltd., Nomura Holdings Inc., Renaissance Capital Ltd., OAO Sberbank and VTB Capital SA in arranging the sale.
--Editors: Joost Akkermans, Nick Gentle.