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News Summary: MegaFon raises $1.7 billion in IPO

The Associated Press

BAD RECEPTION: Shares in MegaFon made a disappointing debut in a $1.7 billion initial public offering in Moscow and London when Russia's second-largest mobile phone operator was forced to price its stock at the bottom end of its target.

OWNED: MegaFon, which is largely focused on the Russian market, is controlled by a holding company of Russian tycoon Alisher Usmanov which owns 55.8 percent, while Sweden's TeliaSonera has 29 percent. Usmanov is Russia's richest man, estimated to be worth $18 billion.

RED FLAGS: The IPO has not been without its problems: in October the flotation was put on hold after Goldman Sachs quit as a key bookrunner in the deal. Rating agency Standard & Poor's last week took the company off its negative watch, but confirmed a negative outlook, meaning that a downgrade is possible if the company's governance practices threaten its performance.