Rusal accuses Potanin, By Stocksak, of breaking the Nornickel shareholder agreement


© Stocksak. FILEPHOTO: These ingots of aluminum are stored at the foundry shop in Krasnoyarsk’s Rusal Krasnoyarsk Aluminium Smelter, Russia, October 3, 2018. Picture taken October 3, 2018. REUTERS/Ilya Naymushin/File Photo


MOSCOW (Stocksak). Russian aluminium producer Rusal announced Monday that it had filed a lawsuit against London alleging Vladimir Potanin is violating a decade-old agreement. This renewed a dispute between two of Russia’s largest metals companies.

Moscow brokered the 10-year agreement between Nornickel’s two largest shareholders in 2012 – Potanin, and Rusal. Oleg Deripaska was then controlling Rusal. This formula protected its dividend payouts by a ratio of its earnings and its debt.

The deal expires at year’s end.

Rusal, which owns a 26.2% stake at Nornickel, stated that the lawsuit filed in London’s High Court of Justice against Potanin’s affiliate Whiteleave Holdings Ltd on Oct. 21 was intended to protect the interests of shareholders.

The statement stated that “Rusal”s claims were based on Mr. Potanin’s failure to fulfill his duties of Norilsk Nickel’s managing shareholder and CEO. Under Mr. Potanin’s management, Norilsk Nickel suffered significant losses in assets that were key to the group’s activities. This led to Norilsk Nickel and its shareholders suffering substantial losses.

They are two of Russia’s most powerful businessmen. They had previously argued over how much profit should go back to investors and how much should go into Nornickel. Interros, Potanin’s holding, has 36% of Nornickel.

The Interros Group was unavailable for comment immediately.

The dispute over the largest prize in the post-Soviet carving-up of Russian industry goes back to 2008, when Rusal purchased a stake at Nornickel for $14 Billion. Potanin opposed attempts to merge the two companies by Deripaska.

Potanin floated the idea of a $60 Billion merger of Nornickel and Rusal in July to mitigate possible sanctions risks. However, he stated last month that the idea had been rescheduled.

He also stated that the 10-year shareholder agreement protecting Nornickel’s dividend payouts was set to expire at 2022. Stocksak was told by sources that there are no negotiations to renew the agreement.

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