Alrosa Considers IPOs of Mining Subsidiaries

Alrosa is interested in expanding existing mines such as Mir (above) as well as developing new ones, rekindling its interest in an IPO

In order to fund new projects and repay its debt, Russian diamond monopoly Alrosa may hold initial public offerings (IPO) for at least two mining divisions, Interfax reported last week.

The company could consider IPOs and bond sales for its Alrosa-Nurba in Siberia and Alrosa-Africa subsidiaries in Angola, a company spokesman told The Moscow Times. Alrosa may also sell shares publicly or through a private placement for its Severalmaz operation in northern Russia.

Alrosa did not disclose more details about the planned offering, but it did state that demand for rough diamonds was up and that it expected sales revenue of more than $300 million for January.

Alrosa declared that it intends to strengthen its presence in emerging markets such as India and China. The two countries are not only growing consumer markets but also important manufacturing countries, with large diamond polishing capacities.

It’s not clear what form this declared presence will take, considering that Alrosa sells rough diamonds.