OREANDA-NEWS. November 20, 2009. Oleg Deripaska, the Russian billionaire owner of the world's largest aluminum producer United Co. Rusal, said the restructuring of more than USD 14 billion of debt owed by the company is "almost" complete.

"We are just going through the bank procedures," Deripaska said in an interview. "We have 70 banks but I am pretty sure we are practically done."

Rusal needs to agree on the restructuring with foreign lenders before it can proceed with a planned initial public offering in Hong Kong. The Moscow-based company intends to sell 10 percent of its shares to help repay borrowings, which ballooned last year after Rusal bought 25 percent of OAO GMK Norilsk Nickel, Russia's biggest mining company, before commodities prices collapsed in the second half of 2008.

"I have committed a lot of time and effort to restructure the debt," Deripaska said yesterday in Singapore, where he was accompanying Russian President Dmitry Medvedev who was attending the Asia-Pacific Economic Cooperation forum. "It was not easy to do."

Deripaska, 41, whose Basic Element investment company employs 1 million people in Russia, said Asia is "very important" to Rusal. The company said last week it's seeking seven or eight major customers in China to secure long-term aluminum deliveries. Rusal's smelters in Siberia and its hydropower potential offer the region more efficient and environmentally friendly aluminum production, Deripaska said.

Asian Partners

"We believe we can create a lot of solutions which will cut a lot of waste and create sustainability, but also to attract more partners from this region who are interested in developing new projects with us," he said.

Rusal's debt almost doubled after it bought 25 percent of Norilsk from billionaire Mikhail Prokhorov for USD 7 billion in cash and a 14 percent stake in Rusal. The aluminum producer had a net loss of USD 6 billion for 2008, Vedomosti reported last month. Rusal got USD 4.5 billion from Vnesheconombank in October last year, the biggest state bailout of any Russian company. In December, Rusal announced plans to cut 5 percent of jobs worldwide and reduce aluminum output.

"We were able to drop our costs by 25 percent in less than six months," Deripaska said. "We have more aggressive plans to cut the costs to be even more competitive, and will be considering different opportunities for our business development including building joint ventures."

U.S. Travel

Deripaska's 56.8 percent stake in Rusal will drop to 53.4 percent after Prokhorov completes a USD 2 billion debt-for-equity swap. Deripaska's shareholding is likely to fall to less than 50 percent should Rusal successfully sell all the new shares it plans to offer in Hong Kong.

Deripaska declined to comment on the progress of the IPO. Rusal picked Bank of America Merrill Lynch, the biggest U.S. bank by assets, to help market the offering, he said. The IPO will be led by Credit Suisse Group AG and BNP Paribas SA, with banks including BOC International Holdings Ltd. and VTB Group helping to manage the sale.

Goldman Sachs Group Inc. walked away from Rusal's IPO, which is slated for December. Goldman may have abandoned efforts to get a role as an underwriter because of concerns about Deripaska, the Wall Street Journal reported earlier this month.

U.S. officials prevented Deripaska from obtaining a visa because of allegations that he is connected to organized crime, the newspaper said. No one at Goldman Sachs in London was immediately available for comment.

"We maintain a good relationship with Goldman," Deripaska said. "I have no restrictions to travel to any country." He traveled to the U.S. twice in the past four months, he said.