New Nat Rothschild venture set to unveil IPO plan - Reuters

Fri Jun 3, 2011 9:50am EDT. By Douwe Miedema and Clara Ferreira-Marques.
* IPO to raise around 1 billion pounds-sources
* Acquisition vehicle set to be sequel to Vallar
* Eyes oil assets, early stage and in production-sources

LONDON, June 3 (Reuters) - An acquisition vehicle backed by financier Nathaniel Rothschild and former BP (BP.L) boss Tony Hayward will announce its intention to float as early as next week, several sources familiar with the situation said.

It aims to raise around 1 billion pounds ($1.6 billion) to invest in oil assets, the sources added on Friday.

The board of Vallares -- set to be a sequel to Rothschild's Vallar (VAAR.L), a mining investment vehicle which now has a market value of 2.5 billion pounds -- has approved publication of a so-called "pathfinder" prospectus and will begin courting a large group of investors on Friday or early next week.

"The prospectus ... has been approved for distribution," said one of the sources. "It will be privately distributed to a very, very large group of investors."

Three of the sources said the group was aiming for a listing in the "pre-summer IPO window", meaning it would aim to make its debut on the market in the coming month, despite ongoing market volatility and an uneven success rate for European offerings.

Two of the sources said Vallares could secure preliminary interest in up to 80 percent of its stock before going public with its listing plans. It could tap sovereign wealth funds and has already found substantial appetite, the sources said.

The intention to float will be published in the next two weeks, the sources said, though it could be as early as next week. An initial marketing period will follow, after which the firm will publish a complete prospectus.

Vallares -- "Vallar part two" -- marks the latest venture for the enterprising Rothschild.

The 39-year-old scion of the famous banking family, in line to be the fifth baron, is also an investment banking and hedge fund veteran with diverse business interests and political and business connections to match.

Rothschild, whose main home is in the Swiss ski resort of Klosters and who spends hundreds of hours a year on his private jet as a result, was listed as Britain's 67th richest man by the Sunday Times Rich List, with a personal fortune that tripled in 2010 to an estimated 1 billion pounds.

The public offering of Vallares also marks a milestone in ousted BP boss Hayward's return from the wilderness, just weeks after he took a seat on the board of newly listed commodities trader Glencore (GLEN.L). [ID:nLDE73C2AU]

TWO YEARS FOR DEALS
The vehicle will target stakes in early stage projects or projects in production where operating firms need cash to expand. It will not, however, target so-called "tail" assets being sold off by oil majors.

"They are not going to second-hand car boot sales," one of the sources said.

The market for exploration blocks and producing oil fields is extremely competitive with state-backed Asian oil companies especially eager bidders, often at prices which Western oil companies consider uneconomic.

With a warchest of 1 billion pounds, Vallares would not be a major force in a field where minority stakes in medium-sized oil fields can sell for more, though sources said it could consider stakes of varying sizes.

Under the structure being finalised, set to be detailed in the full prospectus, Vallares will have two years to do a deal.

Vallares will have several heavyweights on its board including Julian Metherell, a senior banker formerly at Goldman Sachs (GS.N). News reports have said Petrofac (PFC.L) Chairman Rodney Chase, ex-Corus Chairman Jim Leng and former Enterprise Oil Chairman Graham Hearne may also be on the board.

Vallar, Rothschild's mining vehicle, underwent a major transformation last year, with the Bakrie Group and the Rothschild family joining forces for Vallar to take a 25 percent stake in coal miner Bumi (BUMI.JK) and a 75 percent stake in Berau Coal Energy (BRAU.JK).

The Bakrie group will own 43 percent in the combined London-listed company, which will be renamed Bumi. ($1=.6116 Pound) (Additional reporting by Tom Bergin; Editing by Jon Loades-Carter and David Cowell)