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Eastern Europe
April 20, 2018 www.intellinews.com I Page 19
for shares of Rusal parent En+, but these and other operations were abruptly discontinued due to sanctions against Rusal, En+, and other businesses of Russian tycoon Oleg Deripaska.
Previously the Finance Ministry of Russia said that it would support Rusal with short-term liquidity, but unconfirmed reports suggested that the government will stop short of acquiring excess metal for state reserves. Rusal employs almost 60,000 people in Russia and accounts for about 16% of the country’s export earnings.
"The sanctions are likely to have a profound effect on the designated companies, which would be unable to transact in US dollars," Fitch Ratings wrote on April 13, reminding that around
80% of Rusal aluminium major's total revenues in 2017 came from sales outside of Russia, including 10% directly to US customers.
In addition to the reduced trading activity, some designated companies may be unable to service their US-denominated debt. Rusal already warned of a possible technical default on its bonds last week that set of a wave of selling
in its stock and other companies controlled by Deripaska.
As for the pledged state support, the likelihood, mechanisms and longevity of possible support extended by the Russian finance ministry remained unclear to the rating agency.