Oleg Deripaska bullish as Rusal float crashes

The Hong Kong flotation of Rusal, Russian oligarch Oleg Deripaska's aluminium giant, saw its shares crash more than 10 per cent on the first day of trading.

Despite the flotation price of HK$10.80 plummeting to a close of HK$9.66, Deripaska, wearing a black suit with a large red button-hole (Rusal's brand colour), said the "price is reasonable". He added: "You've seen what happened with the financial situation in recent days." He presented the Hong Kong exchange with a 12kg Russian babushka doll.

Deripaska, once Russia's richest man, is friends with Business Secretary Lord Mandelson, and shadow chancellor George Osborne once visited him on his yacht while staying in Corfu with Nat Rothschild — another Deripaska friend. Rothschild, American hedge fund Paulson and Russian state bank VEB are among the big paper losers on today's share slide. They have all agreed six month lock-ins on their share stakes.

Rusal delayed its flotation twice last year and the share offering was restricted to institutional investors and wealthy individuals.

"The market sentiment right now isn't very good," said Helen Lau, an analyst at OSK Asia Holdings. "Investors are concerned about Rusal's debt risks. If the market outlook for aluminium improves and the potential risks diminish, people would be interested."