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Report: Eurasian Resources plans spinoff, listing of certain assets to cut debt

Kazakh miner Eurasian Resources Group Sàrl is working with VTB Capital and Rothschild on a plan to spin off and list some of its assets to partially repay its debt, Reuters reported Feb. 22, citing sources.

The miner, registered in Luxembourg, owns ferrochrome, aluminum, iron ore and energy operations in Kazakhstan, copper and cobalt assets in Africa and iron ore mines in Brazil.

In 2017, the group agreed with VTB to extend the terms of its US$3 billion debt to 2022. Eurasian Resources owed US$5.8 billion to VTB and Sberbank as of July 2016.

"The company needs to raise cash and is looking to spin off some of its assets, most likely the ferrochrome and power ones, and list them," one source said.

Eurasian Resources is also said to be looking to tap Chinese or Japanese shareholders to invest in up to a 20% stake in the assets, another source said.

The company would likely list the spun-off assets in London or Hong Kong, sources said.

Rothschild and VTB declined the newswire's request for comment.

Eurasian Resources, which off-loaded about US$1 billion of projects in the past few years, is developing large-scale projects worth more than US$2 billion with China as part of the Belt and Road initiative.

In 2013, the Kazakh government and the company's founders took the miner private in a US$4.5 billion buyout, six years after listing on the London stock exchange.

S&P Global Market Intelligence was unable to independently verify the report.