October 08, 2008

Rusal offers to buy Mr Prokhorov stake in Norilsk - Report

Vedomosti reported that Russian aluminum giant United Company Rusal has offered to buy Mr Mikhail Prokhorov out of Norilsk Nickel. However it is not clear whether UC Rusal is looking at Prokhorov's entire stake in Norilsk Nickel which currently stands at 29%.

Vedomosti, citing unnamed sources close to both companies and two businessmen close to Mr Prokhorov reported that talks on the sale of Mr Prokhorov's stake have been held over the summer between UC Rusal and Onexim, the holding company for Prokhorov's business interests.

Vedomosti said that Mr Prokhorov would be paid partly in cash and part of the payment would be in new UC Rusal shares, making him a shareholder in UC Rusal.

Earlier this year, Mr Prokhorov and Mr Vladimir Potanin announced a separation of all their business interests including Norilsk. Under that deal, Mr Prokhorov was to sell his stake in Norilsk to Mr Potanin. That deal never went through, however, with Onexim recently announcing that Mr Prokhorov now considers Norilsk a strategic asset and has no immediate plans to sell.