UPDATE 2-Usmanov's firm to study Norilsk merger proposal

(Adds details, quotes, background)

By Robin Paxton and Anastasia Teterevleva

MOSCOW, Feb 21 (Reuters) - Billionaire Alisher Usmanov's iron and steel firm on Thursday expressed interest in a proposal to create a Russian mining giant by merging with Norilsk Nickel (GMKN.MM: Quote, Profile, Research) and placed a value of $30 billion on its own assets.

Metalloinvest General Director Maxim Gubiyev told reporters he expected his company to achieve such a valuation by the end of 2008, a year in which he also forecast $1.2 billion in investment and a near 40 percent increase in pretax earnings. Norilsk Nickel is studying a proposal from Dresdner Kleinwort bank to merge with Metalloinvest, an idea that could complicate plans by another Russian billionaire, Oleg Deripaska, to effect a merger between his aluminium company and Norilsk.

Gubiyev said the bank made no direct proposal to Usmanov or Metalloinvest, but that the company saw potential in the idea.

"For us, it would be an interesting development. The more we think, the more we understand: why not try it?" he said.

"We, as a group, are prepared for mergers."

Metalloinvest manages the assets of holding group Gazmetall, which include Russia's two largest iron ore mines and two steel mills that rank the company fifth in terms of output. Analysts have previously valued the unlisted firm at $15-20 billion.

Norilsk, which mines a fifth of the world's nickel, has a market capitalisation of $55.8 billion. Its ownership is muddied by a protracted asset split between its two co-owners and former business partners, Vladimir Potanin and Mikhail Prokhorov. Prokhorov has agreed to sell a 25 percent plus one share stake to United Company RUSAL, the aluminium company majority owned by Deripaska. UC RUSAL has stated its intention eventually to effect a full merger between the two companies.