Russia's second largest mobile operator MegaFon has set its Initial Public Offering (IPO) at a price range of $20 to $25 a share to raise $1.7bn to $2.3bn.

MegaFon and its Swedish shareholder TeliaSonera are planning to sell 15 percent of the MegaFon stake and trading is expected to begin in London and Moscow on 28 November.

At the given price range, the company is valued at $11.2bn to $14bn, MegaFon said in a statement. Analysts have estimated a fair value of $12bn to $16bn for the company.

The MegaFon IPO could be the biggest by a Russian firm, since the floating of the internet search firm Yandex in New York which raised $1.4bn in May 2011.

Though TeliaSonera helped set up the company, disputes over the conduct of the company and strategic policies were part of the partnership since the beginning. MegaFon is controlled by Russian billionaire Alisher Usmanov who will retain his stake in the company.

TeliaSonera has decided to reduce its stake in the company and MegaFon is also selling its treasury stocks to cut down its debts amounting to 159m roubles.

MegaFon reported a 20 percent jump in its third quarter profits to 14.9bn roubles ($470m) boosted by increased revenues from adding new customers. The company has 63 million users in Russia.

The company has already kicked off an investor road show in London and Moscow. It also has plans to conduct road shows in New York.

The IPO proceeds are expected to be used for debt reduction and network improvements.