Vienna: Austrian builder Strabag plans to sell shares worth up to 1.3 billion euros ($1.8 billion) in an initial public offering next month, hoping to tap investor appetite for companies doing business in Russia.
A spokeswoman confirmed a report by Reuters last week, saying the IPO would kick off on October 8 and run through October 18, with trading due to start October 19.
The company hopes the IPO would be three times oversubscribed, she said.
The deal is the third major share sale by an Austrian company focused on emerging Europe to be announced in ten days, after rights issues from Raiffeisen International and brickmaker Wienerberger, which are both underway.
Investors said Strabag's Russian business, boosted by Russian billionaire Oleg Deripaska buying a 30 per cent stake in Strabag in April and by new deals signed in May, was the main reason why the IPO was likely to be a success.
"They can certainly tell a good story with the whole Russian potential coming from the Deripaska stake, so this [IPO] should definitely be possible," said Walter Harecker, a fund manager at Austria's Constantia Privatbank.
"The market isn't necessarily bad, really - of course the credit crunch weighs, but especially new stories are going down quite well. After all, there is still enough money out there." Strabag expects to have just 400 million euros of output in Russia this year, but said in May that it had an order backlog of three billion euros in the country.
Strabag had initially planned to launch the IPO for 1.5 billion euros in April but called it off days before the launch after Deripaska agreed to buy his stake.
Deripaska at the time paid 42 euros per share, or 1.05 billion euros in total, for his stake, and investors said they expected Strabag to ask for more this time.
