Rusal says it has no objection to $3.5 billion Norilsk share buyback
21 Feb, 2011 08:34
Russian aluminium giant Rusal has officially stated it isn’t against the $3.5 billion Norilsk Nickel share buyback, which was being undertaken by Norilsk subsidiary Corbierre, and was halted after a St Kitts & Nevis court ruled in favour of Rusal.
In a statement on Monday Rusal noted that Corbierre had interpreted the St Christopher & Nevis court decision as meaning that it had to halt the share buyback and that this was a different interpretation to that of Rusal.Rusal added that it had provided Corbierre with a written statement confirming that it was not against the share buyback. “The security measure received by Rusal at the court of Nevis doesn’t ban the completion of the share buy back. We know that Corbiere interprets the text of the court definition in a different way. Though we think that our position is correct and clear, to avoid any doubts we have provided Corbiere a written statement that we are not against the completion of the share buy back, and also suggested Corbiere agree the court definition in writing, which will remove any questions regarding the completion of the buy back.”Rusal also stated that the Corbierre actions were deliberately intended to create negative sentiment among Norilsk Nickel shareholders about Rusal.“Unfortunately, Corbiere doesn’t reply to these proposals of essence, preferring to manipulate minority shareholder dissatisfaction instead, to setthem against Rusal to call off the maximum number of votes at the EGM on March 11 this year.”The statement by Rusal refers only to the share buyback being undertaken by Norilsk in January.The Rusal statement makes no mention of the proposed $12.8 billion proposal from Norilsk to Rusal to buy 20% of its 25% stake in Norilsk, which is currently under consideration by Rusal.Rusal CEO Oleg Deripaska, in an interview last week, indicated he was against accepting the offer, but Mikhail Prokhorov’s Onexim, a 17% stakeholder in Rusal, and former CEO of Norilsk Nickel, has issued a statement saying the Norilsk proposal reflected market prices and that Onexim would be in favour of accepting the Norilsk proposal. Uralsib chief strategist, Chris Weafer, believes that a resolution to the long running shareholder battle at Norilsk is likely soon, with the key issue remaining only price.“It is a period that we are now entering the end stages of this long running dispute. We know that some key minority shareholders in Rusal were pressing the board to accept this deal and even the controlling shareholder himself has now acknowledged that they are likely to sell – it is now the question of price haggling. So, we certainly see that we are more likely to get a deal over perhaps within the next few weeksor it might even take the next few months. But in principle, I think, we are now talking about the price of the exit rather than the principle of the exit – I think, that’s now being established.”