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April 13, 2018 www.intellinews.com I Page 5
Rusal, EN+ worst hit
Deripaska’s Rusal saw the biggest fall, dropping 20.35% in the day, reports Tass, as aluminium- trading houses almost universally suspended operations with Rusal.
Under the stricter terms of the SDN list, US companies and individuals are barred from doing business with those named on the list and by extension with their companies. The sanctions can only be removed by an act of US Congress. US companies now have 30 days to unwind their positions and cancel their business deals with those included on the SDN list.
"Persons from the United States are now prohibited from dealing with persons who have been sanctioned by sanctions and companies, almost all transactions with them are banned," said Eric Ferrari, head of the Washington-based law firm Ferrari & Associates.
The conditions on Deripaska’s companies are even tougher than on the others named in the list: US investors must sell their shares and debts in his companies by May 7, though they are allowed to hold the company’s bonds, according to reports.
The effect of Deripaska’s inclusion in the list
is to make all his companies toxic to investors
and partners. Rusal's main shareholder En+, which successfully held a $1.5bn IPO in London last year, saw trading in its GDRs suspended on the London Stock Exchange (LSE) by the UK's Fi- nancial Conduct Authority for the session of April 9. Citi Treasury also blocked all operations with En+ GDRs. The capitalisation of En+ dropped by 30% after the inclusion in the US Treasury’s list. In Moscow, the name lost 20% as of noon on April 9.
Oligarchs and stoligarchs
The other two prominent names on the SDN List were Viktor Vekselberg and senator Suleiman Kerimov, but it is not clear why they were included as they do not belong to Putin’s inner circle nor have they conspicuously benefited from help from the state.
The circle around Putin has closed considerably in the last few years, according to bne IntelliNews government sources, and a small group of stoli- garchs, or state-sponsored oligarchs, have been the main beneficiaries.
VTB’s Andrei Kostin is a member of this group as is Gazprom CEO Alexei Miller, both of whom are on the new list. Igor Rotenberg is the son of Arkady Rotenberg who is a close personal friend of Putin’s and a key member of the stoligarchs, who are ru- moured to meet regularly at Putin’s dacha outside of Moscow. Oddly Gennady Timchenko, who is the second big businessmen that is a core member of the stoligarchs and close to both Putin and Roten- berg, was not included on the list.
Vekselberg and Kerimov are not intimate with Putin. Both are successful businessmen although Vekselberg made his money the hard way and did not participate in the notorious loans-for-shares privatisations in the mid-90s, nor has he owned a bank – the two routes many of the other oligarchs took to fortune – but he is a 90s vintage oligarch. Kerimov, on the other hand, has clearly used
his position as a Federation Council senator to help his career along; he is one of the wealthiest politicians in Russia.
Vekselberg has probably been the least affected by being included in the sanctions list, as his businesses are not listed apart from three invest- ments into Swiss companies. Kerimov on the other hand controls the Polyus Gold company that is listed and has sold off like the other companies with direct links to those on the SDN list.
Renova owns stakes in three Switzerland-based equipment manufacturers, Sulzer AG, OC Oerlikon Corp. and Schmolz + Bickenbach AG, as well
as a holding in Rusal. Shares in the companies tumbled even as Vekselberg took steps to lower his stake in Sulzer to below a majority in a bid to insulate the company, reports Bloomberg.
Andrey Akimov, the head of Gazprombank, is also not a stoligarch or even an oligarch, but as the