Not sure the Russians have quite grasped this yet

Sorting out problems at Norilsk Nickel would help enhance Russia\’s image among foreign investors.

Well, it might do, yes

Mr Abramovich, the billionaire owner of Chelsea soccer club, could also act as a conduit for the Kremlin at the cash-rich company that mines the vast mineral deposits of Russia\’s far north.

Having brought an end to the four-year feud between Mr Potanin and Mr Deripaska, he could potentially end up sidelining them as President Vladimir Putin seeks to restore order at the $30bn miner that was privatised in the mid-1990s.

Might not too. The idea that boardroom disputes (this one was essentially about whether the company should pay hefty dividends or reinvest internally. Derpiaska wanted the divis as he\’s cash poor with large debts. The others preferred internal investment.) get solved by the President taking a direct interest and slipping in one of his buddies is, umm, interesting, as a method of enhancing an image for foreign investors.

Mr Abramovich will hold 5.87pc of Norilsk Nickel, Rusal will hold 7.8pc and Potanin\’s Interros will hold 30.3pc after Norilsk\’s treasury shares – amounting to almost 17pc of its issued capital – are cancelled.

To ensure Mr Abramovich\’s role as enforcer of the peace, the other two billionaires will give him voting power over some of their shares.

It\’s got political fix written all over it, doesn\’t it?

2 thoughts on “Not sure the Russians have quite grasped this yet”

  1. So Much For Subtlety

    No doubt Ritchie and his pet lickspittle Arnald will claim that this just shows what a central role the State can have in running a decent caring economy – moderating the demands of cut throat competition in the interests of the broader community, bringing peace and harmony where there had been division and discord. If only we had statesmen like Putin in the UK to bring about a truly Courageous State that would exualt the poor and humble the mighty.

    It is the stuff of their wet dreams.

    In the meantime where is left as a reasonable investment destination? I can see why people are fleeing to the Swiss franc and the Australian dollar. If only I had bought gold. Still, it can only go up.

  2. It’s the usual Russian method of ruling by decree, i.e. Putin intervenes personally because all other methods have likely bogged down in stalemate and uncertainty (no doubt as a result of unclear and contradicting laws).

    When Exxon were looking to enter Russia in the late 90s, the project approval got bogged down in a legal quagmire and was going nowhere. Putin offered to issue a decree allowing the project to go ahead, but Rex Tillerson refused, saying the project approval must be based in written law, not on the whim of a president. Sensible chap, it seems.

Leave a Reply

Your email address will not be published. Required fields are marked *