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Hong Kong IPOs challenge London's position
The Hong Kong flotation of Russian mining firm UC Rusal has sparked discussion in London's mining world about the benefits of alternative listings, with Hong Kong becoming an increasingly important area for initial public offerings (IPOs).
Despite claims that Rusal would have trouble listing in London because of its debt level and numerous lawsuits, the mining giant's decision to list in Hong Kong was in fact described to investors as a strategic choice, William MacNamara writes in the Financial Times.
"What is really drawing people to consider Hong Kong is the idea that one can get a higher valuation there," Peter Bacchus, global head of mining investment banking at Morgan Stanley, told the paper.
"Peer-group companies that might trade at eight times earnings in London are perceived to trade at, for instance, ten times earnings in Hong Kong."
In other IPO news, China's Yitai Coal is planning a $1 billion (£615 million) Hong Kong IPO in the second to third quarter of 2010, Reuters reports.
Posted by Jon Cummins
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