RUSAL likely to switch IPO from Britain to Hong Kong

RUSAL is likely to move its IPO from London to Hong Kong due to their high appetite for Russian shares and more stringent regulations in London.

HONG KONG (Reuters) - 

Russia's United Company RUSAL, the world's top primary aluminium producer, is considering moving its initial public offering of shares from London to Hong Kong, the Financial Times reported on Wednesday.

The newspaper quoted a senior executive at Basic Element, the holding company of billionaire businessman Oleg Deripaska which owns 66 percent of Rusal, as saying there was a 95 percent chance of a listing in Hong Kong instead of Britain.

He said the likely move was prompted by the greater appetite for Russian shares among investors in Hong Kong, London's more stringent listing regulations and the diplomatic feud between Moscow and London.

Relations between the two, soured for years over Moscow's demands for the extradition of several Russian emigres in London, have dramatically worsened since another emigre, Kremlin critic Alexander Litvinenko, was killed by radiation poisoning in London in 2006.

UC RUSAL has already postponed its IPO because of market turmoil, although it pledged last September that the listing would take place within three years.

The report of a possible switch to Hong Kong comes during one of the most tumultuous weeks ever seen on global equity markets.

The giant aluminium maker is the product of a merger in March 2007 of rival Russian aluminium producers RUSAL and SUAL and assets belonging to commodities trader Glencore.

A spokesman for Hong Kong Exchanges and Clearing Ltd said it was the exchange's policy not to comment on individual cases, although its strategic plan includes a goal of attracting new listings from new markets.

"HKEx will facilitate the listing of issuers from a broader range of jurisdictions than at present, and promote this in overseas markets," HKEx spokesman Scott Sapp said.

(Reporting by Tom Miles; Editing by Anne Marie Roantree)

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