Norilsk offers RusAl for $8.75 bln for 15 pct share buyback

Norilsk Nickel has offered RusAl, which holds a quarter of its stock, $8.75 billion for about 15 percent of its shares, Norilsk said on Friday.

“The price was determined on the basis of recommendations of independent consultant banks and will correspond to $306 per share, which is equivalent to a 20 percent premium to the weighted average market price for the last six months,” Norilsk, the world’s largest nickel miner, said in a statement.

“If the offer to sell shares is accepted by UC RusAl Asset Management LLC, signing of a shareholder agreement is proposed with regards to the 10 percent of the company’s shares remaining under RusAl’s ownership.”
If the board approves this resolution, the offer will be valid until September 5, Norilsk said.

RusAl, the world’s largest aluminum company, controlled by Russian billionaire Oleg Deripaska, and Interros, the investment arm of another Russian billionaire Vladimir Potanin which holds 30 percent in Norilsk, have been locked in a struggle for control of Norilsk Nickel for more than a year. RusAl claims the Norilsk board has become unfairly dominated by officials linked with Interros.

Last December Norilsk made an initial offer to buy RusAl’s 25 percent stake in the metals and mining company for $12 billion. In March this year, RusAl rejected another offer by Norilsk to buy 20 percent of Norilsk for $12.8 billion.

In January Norilsk management initiated a $4.5 billion buyback program in January, which was carried out by Norilsk’s subsidiary Corbiere. The program was to have been completed on February 10, but was suspended following a ruling by a court in the Federation of Saint Kitts and Nevis under a lawsuit filed by RusAl. The aluminum company said the program would distort the company’s structure.

Corbiere renewed the program after a Nevis court discharged its previous injunction and completed the buyback only in March, having acquired 7.2 percent of Norilsk’s shares from minority shareholders.

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