Page 109 - RUSRptOct18

products by state agencies and institutions to support Rusal. Buying products in about 18 categories could limited, ranging from aluminium bars, construction materials, etc. However, this is unlikely to strongly support Rusal that produced 3.7mn tonnes of aluminium in 2017. Russia's imports of aluminium and products thereof in January-July 2017 stood at 0.144mn tonnes, with 44.5% imported from China. In the meantime Rusal and its mother energy and metals holding En+ are reportedly preparing to re-register in Russian Special Administrative Districts (SARs) , a domestic offshore zone the Russian government introduced in August on Russky and Oktyabrskiy islands. Registration in SARs could be a "plan B" in case negotiations with the Treasury will fail, a source close to Rusal management told Vedomosti d aily on August 17, claiming that "residents of SAR could keep the beneficiaries undisclosed and change the whole structure of the holding."
Russian billionaire and CEO metals major Norilsk Nickel Vladimir Potanin returned the 2% stake in the company to another shareholder of NorNickel London-based tycoon Roman Abramovich, Reuters said on September 10 citing unnamed sources. NorNickel recently saw a the flare up of an old shareholder conflict between Interros of Vladimir Potanin, Rusal’s Oleg Deripaska, and Abramovich's and Abramov's Crispian. In June the London High Court resolved the case in favour of Oleg Deripaska , ruling that Abramovich breached the shareholder agreement when selling 2.1% stake in NorNickel to Potanin. After the deal, Interros increased its stake in the company to 32.9%, with Rusal owning 27.8%, but now the deal's reversal has been completed, according to Reuters. Previous reports suggested that the breach of the shareholder agreement by Potanin and Abramovich could give Deripaska's Rusal, as the damaged party, the right to acquire a 7.5% stake in Norilsk Nickel with 25% discount, or buy 1.875% of Norilsk Nickel shares for $1 (current market price of RUB33bn or about $0.5bn).
Russia's largest and world's second-largest aluminium producer Rusal is preparing to cut its output as it will be locked out of crucial annual contract negotiations kicking off this week at the Metal Bulletin aluminium conference in Berlin due to ongoing US sanctions, Bloomberg reported on September 10. Rusal and other businesses of Russian billionaire and Kremlin insider Oleg Deripaska was sanctioned by the US Treasury in April, but the initial deadlines for cutting ties with the company were extended several times after sanctioned sent shockwaves through global aluminium supply chains. Previous reports indicated that Deripaska’s En+ and Rusal could be getting closer to striking a deal with the US Treasury Department to suspend or even lift the sanctions in effect from April 2018. However, the most recent wave of sanction pressure could have this postponed. Unnamed sources told Reuters that Rusal's financials will face "further deterioration" should it fail to reach a deal with USTD by the end of August.
9.2.12 Transport corporate news
Global Ports’ the first half of 2018 IFRS results were close to expectations, with both sales ($175mn; +8% y/y) and EBITDA ($109mn; +12% y/y) coming 2-4% above the consensus forecasts. Adjusted for FX losses, net income was at $35mn vs. a loss of USD 46mn in 1H17. The company kept deleveraging, with 2018F net debt/EBITDA falling to 3.7x. Analysts expect the second half of 2018 to be stronger, as it takes 2-3 months for the weaker rouble to have a negative effect on imported containers and this
109 RUSSIA Country Report October 2018 www.intellinews.com