The London Stock Exchange had its second-biggest flotation of the year this past Friday, when Kazakh copper miner Kazakhmys tapped the public markets for a $1.2 billion capital infusion. The company, which competes with such giants as Britain's Rio Tinto
At just $9.50 each, Kazakhmys's global depositary receipts were priced to sell -- and sell they did, rising 14% on their first day of trading as copper investors swarmed to buy a piece of the world's 10th-largest copper miner. As a result, Kazakhmys now sports a market cap of $4.5 billion.
The IPO proved a success not just for Kazakhmys, its underwriters -- Credit Suisse
While a successful IPO by most measures, the Kazakhmys floatation did prove a failure in one important respect. To do the deal, the company felt it necessary to redomicile itself outside Kazakhstan. In creating a British holding company to control its assets, and then floating the shares of this holding company, rather than of the Kazakh entity itself, Kazakhmys underlined the fact that Kazakhstan's domestic stock markets are still not ready for prime time. Thus, like many of the other smaller former Soviet republics, Kazakhstan has a market still seems likely to lag that of Russia, with the latter's just-as-successful IPOs of domestically domiciled Wimm-Bill-Dann
Fool contributor Rich Smith does not own shares in any company mentioned above.