Potanin to offer $9 billion for RUSAL’s Norilsk stake

MOSCOW (BestGrowthStock) – Russia’s Vladimir Potanin said he would bid $9 billion for RUSAL’s (0486.HK: ) 25 percent Norilsk Nickel (GMKN.MM: ) stake, revisiting an earlier act in the long-running drama for control of the world’s largest nickel and palladium miner.

“About $9 billion, that’s the starting point for the talks,” Potanin said on Friday.

His Interros investment company also holds 25 percent in Norilsk.

Last month, Norilsk Nickel Chief Executive Vladimir Strzhalkovsky told Reuters the company’s pension fund planned to form an investor pool with Interros, and other parties to buy the stake from Oleg Deripaska’s RUSAL.

RUSAL rejected the proposal at the time, and dismissed it again on Friday.

“RUSAL’s board of directors considers this investment as strategic and does not intend to sell it,” Rusal said in an e-mailed statement.

Potanin’s offer comes after Norilsk Nickel shareholders on Thursday rejected a RUSAL proposal to dismiss the current board of directors at the company, which Interros considered a significant victory in the struggle for control of the firm.

RUSAL had hoped to dismiss the board and bring in a new set of executives to spearhead a strategic shift.

Potanin’s offer indicates he has taken the shareholder decision as a vote of confidence that he will leverage to push RUSAL out of Norilsk Nickel.

“I sent this letter on behalf of Interros, but of course there will be a pool of investors with financing from banks,” he said, adding that Western banks could participate in the funding, and that Norilsk Nickel’s pension fund, and unnamed financial investors would be part of the bid.

The row, which has unnerved many investors, came to a head at the June AGM, when RUSAL saw its representation on Norilsk Nickel’s board cut to three seats from four.

Interros and management have seven seats on the board.

Since RUSAL rejected Potanin’s offer, the dispute is likely to continue, especially after the world’s largest aluminum producer on Thursday said it would continue to press for change at the company.

Lawyers are also involved, as RUSAL in August filed an arbitration request in London court in relation to an earlier cooperation agreement for the election of directors to Norilsk’s board.

(Reporting by Polina Devitt; Writing by Alfred Kueppers; Editing by Sharon Lindores)

Potanin to offer $9 billion for RUSAL’s Norilsk stake