Over the counter trade in Russia values Alrosa at $8.6 billion
Interfax reports Russia state-owned diamond miner Alrosa is up 22% on the country’s trading board for unlisted stocks since it was first quoted there on July 18. The price of $31,495 per share, implies a market value of $8.6 billion.
Alrosa accounts for around 25% of world output and for the full year sales of $4.7 billion is expected. The secretive firm has been feeding the market more information recently in anticipation of a 2012 public offering that seeks to raise up to $3 billion.
The group reported a 41% percent increase in the prices of rough diamonds during the first half of 2011 at an average of $113 per carat, rising from $80 per carat in 2010. Alrosa achieved sales worth $2.16 billion, up 9%, and sold 19.1 million carats over the six months period. Profits came in at $598 million, up a whopping 450%.
The company has a stake in an Angolan mine and owns and operates ten open-pit mines and nine alluvial deposits in Russia, including the Mirny pit, the second-largest man-made hole in the world, but little else is known about its operations. MINING.com reported on the secretive world of diamond mining on Thursday.
24/7 Wall St. reports the Alrosa IPO would make about 20% to 25% of the company available to investors and because there is really no other way for investors to make a big play in the diamond market, Alrosa’s IPO could be hugely successful.
Diamond Intelligence reports the Russian Federal Property Agency (Rosimuschestvo) holds 51% of Alrosa’s shares; Yakutia’s Property Relations Ministry owns 32%; eight districts of Yakutia own 8%; and individuals and corporate bodies own the remaining 9%. These shareholders plan to reduce their stake to 50% plus one over the next three years.
Image by Akva / Shutterstock.com is of a circa 1971 stamp of the Shah Diamond which was first mined in India in the 1400s, possessed by Moghul and Persian royals through the centuries before it was gifted to the Russian Tsar in 1914. It remains in the hands of the Kremlin Diamond Fund.