Norilsk Nickel has called an Extraordinary General Meeting for October 21. The move comes after 25% shareholder, Rusal, disputed the June AGM, pushing for arbitration involving it and rival shareholder Interros.

Norilsk’s June AGM saw Vladimir Potanin’s Interros gain 4 board seats, but Oleg Deripaska’s Rusal, only 3 – when both have about a stake of just over 25%. Rusal claims the voting process was flawed – suggesting Norilsk Management, which controls about 8% of its shares through subsidiaries, voted with Interros, and adding that the relationship between them is ‘unhealthy’. It is demanding an extraordinary shareholders meeting and new elections. Marat Gabitov, Metals and mining analyst at Unicredit, says an EGM could see Rusal overturn the June result.

“I think Rusal wasn’t quite prepared for the previous AGM and now I believe the company did it’s homework, and this time around they’re going to get parity with Interross, because they are more prepared and they would get more directors. They did some work with minority shareholders and I believe a significant share of minorities could support UC Rusal this time.”

Amongst those to lose their board seats at the June AGM was former Chairman Alexander Voloshin. Speaking to Interfax on August 10 he said he was prepared to return to the board but that some form of agreement between the warring shareholders was needed.

"There has to be sane, constructive relations between them, and this is not in evidence so far,"

Rusal has since proposed buying out the Interros stake, only to be met with Interros – and Norilsk management – proposing to buy out Rusal. Analysts say a board change is now the only chance for Rusal to restore its position in Norilsk Nickel. Interros has freed up 6.35% of Norilsk shares from pledge to VTB bank – a move that is seen as preparation for a buy-back. If that happens Rusal could be left out of the game in the running of Norilsk. Olga Okuneva, Metals and mining analyst at Deutsche bank believes Rusal needs to come to agreement with Interros.

“There are in general a number of scenarios. I mean, potentially they can sell this stake, but I understand they’re not willing to do it right now. Another option that Rusal would be willing to do is to merge two companies – Rusal and Norilsk Nickel. But this is not in the interest of Interros and Nornickel itself, so right now I see it’s a bit of a deadlock. So I think the most constructive way right now is for the shareholders just to sit and talk to each other.”

The warring shareholders of Norilsk have previously put aside their differences at the height of the global financial crisis, with an agreement not to try and take control of Norilsk and with parity on the board. Now that the parity has been broken – and with both sides saying they wont sell – observers say a new round of negotiations is the only way forward.