Russia slashes stake in top diamond miner Alrosa, set it for $1.6-bn float
The sale, the gem industry's largest in over a century, will see the Russia’s federal government and the regional administration of Yakutia, where Alrosa is based, each sell 7% of the miner. Alrosa’s management will also sell a 2% and use the proceeds to pay down debt, said the company (statement available only to Russia-based investors).
Following the sale, Alrosa will become one of very few pure listed diamond miners, but somehow out of reach for many, as it will be only listed in Moscow for now.
Russia's federal and regional governments will own 44% and 25% respectively once the deal is closed, which is expected to happen by the end of the month.
The announcement comes as global prices for rough diamonds – Alrosa’s core product – are predicted to reach skyrocketing prices by 2018.
Alrosa’s shares took off on the news, adding as much as 9% Wednesday. It traded up 8% at 39.20 rubles by 3:33 p.m. Moscow-time, the highest level since December 2011.
Image by Valerii Tkachenko/ Wikimedia Commons