Aluminium firm Vimetco falls on London debut

By Miyoung Kim

LONDON (Reuters) - Shares in Vimetco fell as much as 8 percent in early Friday trading, after the aluminium producer raised $515 million (253 million pounds) in an initial public offering priced just below the middle of its indicative range.

The stock (VICOq.L) was priced at $9 per global depositary receipt, within the expected range of $8 to $10.5 per GDR. But by 10:20 a.m. it had fallen 4 percent to $8.6, though this was off an earlier low of $8.25.

The IPO pricing implied a market capitalisation of around $2 billion and the total size of the offering will increase to $593 million if an over-allotment option is used, Vimetco said.

The Dutch holding company, which produces aluminium in China and Romania, said the offering of new and existing shares was 30 percent of its share capital.

Vimetco, which says it is a top 10 aluminium producer in China and the largest in central and eastern Europe, will receive $94 million of the proceeds. Selling shareholders included Romal Holdings N.V.

"Institutional support for the deal has been widespread, demonstrating investor confidence ... and broad recognition of the opportunity and potential within the Chinese market," Chief Executive Christian Wust said in a statement.

"The offering enables us to continue our strategy of developing Vimetco as a vertically integrated aluminium company, offering a wide range of value-added products."

Global aluminium producers have been active in the financial market with flotations and mergers and acquisitions to capitalise on soaring demand for commodities in emerging markets, including China.