RusAl Nominates Warnig in Bid to End Board Spat

RusAl, the world’s largest aluminum producer, has nominated Matthias Warnig, head of Nord Stream AG which operates the gas pipeline from Russia to Europe, for election to its board of directors as an independent non-executive director, the firm said in a statement on Monday.

Analysts consider Warnig’s nomination – likely to be approved at RusAl’s annual shareholders meeting on June 15 – is a move to help solve shareholders conflicts in the aluminum giant.

“The nomination of Matthias Warnig as an independent non-executive director is further step in RusAl’s stated aim of promoting corporate governance excellence. RusAl is planning to increase the number of independent non-executive directors in the board up to one third in accordance with the new rules of the Hong Kong Stock Exchange,” RusAl said.

Warnig has previously been a chairman of the board of directors of Russia’s oil pipeline monopoly Transneft, a member of the supervisory board in the country’s second top lender VTB, and on the board of directors at Bank Rossiya and oil giant Rosneft.

RusAl’s former board chairman Viktor Vekselberg resigned from his board post in mid-March, after what he said were disagreements with a number of recent decisions made by the company’s management, particularly over its debts and its handling of its stake in Norilsk Nickel.

RusAl claimed the changes “were deemed necessary by the fact that Mr. Vekselberg had failed to perform his functions as a public company board chairman over the past 12 months.”

Vekselberg also filed a suit against the aluminum giant in early April concerning approval of long-term contracts worth over $47 million signed between RusAl and Glencore to supply primary aluminum and alumina. RusAl’s contract with Glencore stipulates that the trader will sell 1.4 million tons of aluminum, 30 percent of RusAl’s overall export supplies in 2012. That share may reach 50 percent in the next six years.

Stanislav Tsygankov, head of Severneftegazprom gas firm, said Warnig will help the company solve the conflict.

“It is meaningless to put pressure on him because he is a man of principle,” Tsygankov added.

Metropol analyst Sergei Filchenkov thinks Warnig’s nomination will influence the Rusal board conflict.

“Warnig will most likely act as a state supervisor taking into account his representation in many [Russian] companies as an independent director but it seems we will not see a resolution of the conflict soon,” Filchenkov said.


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