(Adds share move, analyst, free float, background)
By Jan Lopatka
PRAGUE, May 6 (Reuters) - Czech coal miner New World
Resources (NWR) <NWRW.L> <NWRSsp.PR> priced an initial public
offering at the top of its range on Tuesday, raising 1.1 billion
pounds in a heavily oversubscribed issue of new and existing
stock.
NWR said the IPO in London, Prague and Warsaw would value
the entire company at 3.5 billion pounds, the biggest initial
offering so far this year in London and the biggest ever in
Prague.
The company said the IPO was priced at 13.25 pounds, at the
top of the indicative range of 10.75-13.25 pounds, and was 7.3
times oversubscribed at the top price. Total demand was worth
9.2 billion pounds.
The stock rose as much as 7 percent in London to 14.20
pounds but dropped to 13.80 by 0728 GMT, 4.2 percent above the
issue price.
The offer of 83.01 million shares included 13.5 million
newly issued stock and represented 31.5 percent of the company.
Most of the shares went to institutional investors.
"NWR intends to use the net proceeds of the sale of new A
shares principally to fund its capital investment programme and
additional growth opportunities, which include further
exploration, joint ventures or strategic acquisitions of new and
mothballed mines," the company said.
The selling shareholder was RPGI, owned mainly by Czech
financier Zdenek Bakala and Crossroads Capital Investments.
The offer can be raised by a 15 percent over-allotment
option, which is not included in the valuation.
Gross proceeds from the sale of new shares were 179 million
pounds, based on the issue price.
Czech brokerage Atlantik FT gave the stock a 'neutral' and
'long-term buy' rating, with the target price of 474 crowns,
11.3 percent above the issue price.
"We expect the share price of NWR to be positively affected
by the strong demand in its first trading days. Our one-year
target price is set at 474 CZK (15.1 GBP), we recommend to buy,"
it said.
EXPANSION PLANS
NWR is the full owner of Czech group OKD, which mines coking
and steam coal in the east of the Czech Republic. It plans to
develop two mines in Poland, across the border from its Czech
operations.
NWR said contracted coking coal prices had jumped 61 percent
this year from 2007, while steam coal prices rose 44 percent.
Morgan Stanley, Goldman Sachs and JP Morgan Cazenove were
joint global co-ordinators and bookrunners for the IPO.
Citigroup was a joint lead manager.
NWR's revenue rose 10.7 percent last year to 1.37 billion
euros ($2.2 billion) and net profit jumped 94 percent to 196
million euros.
NWR's biggest customers include steel makers such as Arcelor
Mittal Steel <MTP.PA> <ISPA.AS> and U.S. Steel <X.N>, energy
utilities such as CEZ <> and large industrial companies
in central Europe.
The company has said it has 419 million tonnes of proven and
probable saleable reserves. That includes reserves at a Polish
mine where NWR has yet to obtain approval to start mining.
(Reporting by Jan Lopatka; Editing by Stephen Weeks)
