Russia's Evraz bucks trend, mulls IPO of U.S. assets

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MOSCOW, Sept 19 (Reuters) - Russia's largest steelmaker Evraz (LSE: EVR.L - news) is considering an initial public offering (IPO) of its North American assets, a rare move by a Russian company to raise funds in the United States after Washington imposed sanctions on Moscow over Ukraine.

Evraz, which is partly controlled by Chelsea soccer club owner Roman Abramovich, has not been targeted by the sanctions, which have prevented some of Russia's top state companies and banks from raising capital in Western markets.

It would be the second time the steelmaker, which had net debt of $6.1 billion at the end of June, has tapped Western markets this year after it signed a $425 million loan with a syndicate including Deutsche Bank (Xetra: 514000 - news) , ING, Nordea and Societe Generale (Paris: FR0000130809 - news) last month.

"Any offering would commence after the SEC completes its review process, which would be initiated by the filing of a registration statement," Evraz said in a statement on Friday.

"The company has not filed a registration statement but may do so in the foreseeable future."

Evraz did not say what share of the business it could sell or which banks would help it with the sale.

The SEC is the U.S. Securities and Exchange Commission.

Its Chicago-headquartered unit, Evraz North America, includes facilities Oregon Steel, Rocky Mountain Steel, IPSCO and suspended Claymont Steel. They produce steel products for infrastructure, defense, energy and rail industries.

The enterprise value (EV) of the North American assets may reach between $2.1-2.6 billion, analysts at Alfa Banks said in a note. If Evraz places up to a 50-percent stake, it would be able to raise between $500-700 million and then could cut its net debt to $5 billion by the end of 2014, Alfa Bank added.

The Alfa Bank forecast was based on an estimate of Evraz's North American assets earnings before interest, taxes, depreciation and amortisation (EBITDA) in the range of $300-350-million. The U.S. steel stocks are currently trading at 2014 EV/EBITDA ratio of 7-7.5, Alfa Bank said. (Reporting by Polina Devitt and Svetlana Burmistrova; Editing by Elizabeth Piper)