MOSCOW, December 4 (RIA Novosti) – Russian billionaire Roman Abramovich is buying a stake in mining and metals giant Norilsk Nickel to end a long-standing shareholder dispute over the company’s corporate management.
This follows an agreement signed between Norilsk Nickel’s core shareholders RusAl and Interros.
RusAl, which has a 25 percent stake in Norilsk Nickel, said in a statement on Tuesday, that Abramovich’s Millhouse Capital will buy about 7.3 percent of the mining giant’s quasi-treasury stock.
The deal is worth an estimated $2 billion, and comes as part of an agreement between RusAl’s owner Oleg Deripaska and billionaire Vladimir Potanin’s Interros holding company, which has a 28 percent stake in the company.
Under the agreement approved by RusAl’s board of directors on Monday, Potanin will replace Norilsk Nickel’s CEO Vladimir Strzhalkovsky. RusAl and Interros will each have four representatives on the metals giant’s board of directors, Millhouse will have three, with RusAl and Interros nominating two independent directors.
The agreement also sets out measures to safeguard stable dividend payments for the period 2012-2014.
There had been media reports that Norilsk Nickel’s core shareholders could sign a memorandum of intent by December 3, with a view to signing a new shareholder agreement. Increasing dividend payments from the current 25 percent to 50 percent of Norilsk Nickel’s net profit was a key condition for signing the document that RusAl set.
The London Arbitration Tribunal was scheduled to hear RusAl’s claim yesterday against Potanin about an alleged breach of their 2008 shareholder agreement on Norilsk’s board representation. The hearing was delayed until February, as the sides took steps to settle their feud.
RusAl and Interros have been embroiled in a shareholder row over control of the company since June 2010, when RusAl lost one seat on Norilsk’s board, while Interros increased its control over the firm.
RusAl accused Interros of breaking the parity agreed, and went so far as to accuse the board of directors of vote fraud. Both Deripaska and Potanin have been battling it out in court since then, fighting for control over Norilsk, which has a market value of about $30 billion.
Interros has also repeatedly tried to resolve the conflict by offering to buy RusAl’s stake in Norilsk Nickel. RusAl has rejected at least three such offers since late 2010.