* Says Petropavlovsk undervalued
* Wants former CEO to come back to lead project to boost output
LONDON, Jan 23 (Reuters) - Kazakh businessman Kenges Rakishev, who owns just over a fifth of Russian miner Petropavlovsk, said the company should sell its 31.1 percent stake in Hong Kong-listed iron ore company IRC to focus exclusively on gold.
Rakishev, who bought a 22 percent stake in Petropavlovsk in December, has said his near-term focus is on bringing back former CEO Pavel Masklovskiy to continue work on a project to boost the company's output.
After that, he would seek acquisitions, not just in Russia, but in central Asia, and he said shareholder value would be increased if Petropavlovsk sold its stake in IRC, which has a market capitalisation of around $200 million.
"IRC is a very good company, but it's not adding value for Petropavlovsk shareholders," he said in an interview in London before a closed-door meeting with other shareholders.
Rakishev said Petropavlovsk is undervalued relative to other Russian gold miners.
Leading Russian producer Polyus, for instance, produces nearly 70 tonnes of gold per year, compared with Petropavlovsk's roughly 15 tonnes, but the valuation gap is much greater than the difference in output, he said.
Petropavlovsk has a market capitalisation of just over 270 million pounds ($377 million) compared with Polyus's market capitalisation of 602 billion roubles ($10.65 billion), according to Thomson Reuters data.
Analysts say Polyus is a lower cost producer and a considerable amount of Petropavlovsk's future production depends on a technical project, the Pressure Oxidation Hub (POX), which is scheduled to begin increasing output late this year.
Rakishev, who has previously invested in Kazakh gold assets, said he is committed to Petropavlovsk for the long term. ($1 = 0.7154 pounds) ($1 = 56.5174 roubles) (Reporting by Barbara Lewis; additional reporting by Poliina Devitt in Moscow; Editing by Adrian Croft)