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Norilsk Nickel board unchanged as Rusal continues to push
Published: 22 October, 2010, 12:46
Edited: 25 October, 2010, 16:42
TAGS: Markets, Big deal, Economy, Finance
Norilsk Nickel shareholders voted against a Rusal led proposal to change the board of directors, at an extraordinary general meeting in Moscow.
Business RT spoke with Maksim Sokov, Director of Corporate Strategy at Rusal about the shareholder dispute between Rusal and Interros, starting with if he believed it was damaging Norilsk Nickel
MS: “Any dispute is affecting the company, but the question is whether the dispute leads to any positive trends or positive changes, and we believe that the whole idea which we are promoting, we were calling for this EGM, is to actually rebalance the board in a manner where, there will be no controlling shareholder.”
RT: Will Rusal try to take this conflict further, for example to the courts?
MS: “It is not a fight between two oligarchs, it’s a different story. It's about Rusal being a shareholder in Norilsk, trying to change the situation, and so that a very simple value enhancement plan is implemented?”
RT: Nornickel results are in line with international competitors. What is wrong with the running of the company?
MS: “It is really the best mine, but it has no strategy, and it has cash on the balance sheet. So either management should come to the board with a proper strategy which would include organic growth projects, and would explain us where these monies have to be spent – and that spending would create additional value to all shareholders – if that is not happening it should be paid out as a dividend.”
RT: Do you believe Nornickel minority shareholders actually support Rusal’s bid?
MS: “Absolute majority of independent shareholders have supported the idea for reelection. Neither of the big shareholders have ever had any dialogue with minority shareholders. Such a big support of minority shareholders is actually a big victory.”
RT: Does Rusal want to raise Norilsk Nickel’s dividends so it can pay off Rusal’s debt?
MS: “We are not looking for Norilsk to pay greater dividends, but we are just saying that the company should either spend money for organic growth projects, or the dividends should be paid out to the shareholders, for shareholders to effectively to decide what to do with these funds. We are repaying our debt way ahead of schedule. We do not need Norilsk dividends.”
RT: Doesn’t Interros also support the disposal of non core assets?
RT: “Yeah, but it's not a sale of OGK. From the media it looks like they are going to be proposing a swap between OGK shares and Inter RAO shares, which is effectively an exchange of one non core asset for another non core asset. In our programme we are supporting either monetizing the non core assets or spinning them off. As far as I know, from the media again, there is going to be a one year restriction for these shares no to be sold to the market.”
RT: Why is Rusal dealing with Interros through the media? Has communication broken down completely?
MS: “We have been talking to each other for quite a long period of time. Since 2008, we’ve been trying to implement this programme, but unfortunately nothing was happening. In this particular situation we had no other choice but to go public and talk to the minority shareholders.”
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4 comments
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I am a shareholder. I voted against Rusal. I beg to differ with Rusal person interviewed by RT..It "is" a fight between two Oligarchs. And lets remember these USSR Oligarchs bought state owned valuable core mineral assets for almost nothing through insider trading and down right thief! Norilsk Nickel is more interested in steady growth and good healthy balance sheet [cash] in a time where global economy that the US Oligarchy almost completely destroyed and still trying will "not" effect Norilsk Nickel negativity. Russian commodities oil, etc. kept rainy day fund under "Putin" growing [remember that in 2012] he made sure RF paid off its IMF loan early AND kept gold backing all RF paper money. P.S. Don't be fooled US currency is OVER valued not under.US stopped backing its currency in 1970s. Its worthless paper backed only by a huge "debt" so large it will never be paid off. US is floated cash wise by China-Japan if they stopped loaning US money it would "officially" be bankrupt! China-Japan hold so much USD's they can't allow US to fall any further BUT slower! Tim Gitner US Secretary of Treasure is balled face liar-bully.NO currency wars now BUT wait until US Oligarchs pulls another world wide crash.Credit Card debt! US middle class will be reduced to lower class. Only Oligarchs will have money WE have seen this picture before and we will see it again IT will be very ugly,brutal.The have nothings will kill the Oligarchs again!.