UC Rusal executives offer assurances about company's debt ahead of Hong Kong listing

HONG KONG (AP) -- UC Rusal executives offered new assurances Monday about the Russian aluminum giant's ability to pay off massive debts, saying its finances were "very stable."
Rusal is seeking to raise nearly 2.6 billion through an initial public offering in Hong Kong this month. Hong Kong regulators imposed a host of restrictions on the offering amid widespread concerns about Rusal's $14.9 billion debt load.
Artem Volynets, a deputy chief executive at Rusal, said he was "very comfortable" with the company's debt. He said a combination of cost cutting, rising aluminum prices and Rusal's recent debt restructuring had put the company in better financial shape.
"There is still a misconception that Rusal is in financial difficulty. It is not," Volynets told reporters in Hong Kong. "The company is in a very stable financial position."
Moscow-based Rusal -- run by tycoon Oleg Deripaska -- is seeking to sell more than 1.6 billion shares at a price between 12.50 Hong Kong dollars ($1.61) and HK$9.10, according to a filing with Hong Kong's stock exchange. Potential proceeds range from $1.9 billion to $2.6 billion.
Under Hong Kong's restrictions, prospective buyers are limited to professional investors and those willing to purchase at least HK$1 million ($129,000) in shares. To start, shares will only be traded in blocks worth nearly $26,000.
The listing is expected later this month.
The company said it plans to use the IPO proceeds to pay creditors. Executives said the company would be able to raise more capital, by issuing more equity or debt, if needed.
Rusal ran up heavy debts during the credit boom that preceded the world financial crisis. Now it's struggling to pay. It reached a restructuring deal with creditors in early December to repay its $16.8 billion borrowing within seven years.
Volynets said Rusal had long eyed Hong Kong to raise capital and tap China's market.
"It's beneficial for China and Russia to develop and gain from the growth of their economies," he said.