LONDON—Russian gold miner Nord Gold PLC said Thursday it aims to list in London and Moscow in the coming weeks, seeking to capitalize on a renewed interest in commodity stocks and strengthening gold prices as a hedge against rising inflation.
The company is targeting a valuation of up to $5 billion, according to a person familiar with the matter, a level that could make it one of the largest mining initial public offerings in recent years. It could also give the miner a place in the U.K.’s prestigious FTSE 100 blue-chip index. The Wall Street Journal reported in January that the company was looking to go public.
A recent boom in commodity prices has rekindled investor interest in mining stocks, analysts say, after years of ignoring the sector. Many mined commodities have hit record prices this year as the global economy rebounds from Covid-19, governments pledge to spend more money on infrastructure and supply stutters for some resources.
Gold has had a more mixed run. After two years of steep gains, its price fell in the second half of last year and at the start of 2021.
But the precious metal is up almost 10% since late February, in part as investors look for hedges against inflation, which is ticking higher amid the economic rebound.
Nordgold, as the company calls itself, isn’t planning to raise any fresh funding in the IPO. Instead, its existing shareholders plan to sell at least 25% of their stake in the miner, giving it a free float that would make the stock eligible for inclusion in London’s main indexes.
Nordgold, which operates nine mines in Russia, Kazakhstan and West Africa, produced over one million ounces of gold last year and generated more than $1 billion of adjusted earnings before interest, tax, depreciation and amortization.
While a successful IPO would likely be one of the largest for a mining company for years, Nordgold’s targeted valuation of up to $5 billion would trail that of other gold miners such as Newmont Corp. and Barrick Gold Corp. , which have market capitalizations of $58 billion and $43 billion respectively.
Other gold miners have also looked to list in London. Toronto-based Yamana Gold Inc. added a London listing last year and Canada’s Endeavour Mining Corp. has said it plans to take a secondary listing on the exchange this month.
Write to Ben Dummett at [email protected] and Alistair MacDonald at [email protected]
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