Russia's Potanin weighs $60 bln metals merger as defence against sanctions



* Nornickel-Rusal merger would create national champion - Potanin

* Deal would also help to resist sanctions - Potanin

* Global markets depend on firms' palladium, nickel, aluminium

July 5 (Reuters) - Russian businessman Vladimir Potanin has said he is ready to discuss a possible merger between his mining group Nornickel GMKN.MM and aluminium producer Rusal 0486.HK , a move that could strengthen their defences against any possible Western sanctions against them.

Potanin told RBC TV he had sent a letter on Monday confirming his agreement to start merger discussions, citing the desirability of creating a "national champion" and building up "extra stability against sanctions".

The initial proposal, which would create a company with a combined value of about $60 billion - similar to Glencore, came from Rusal management, he added.

Rusal, the world's largest aluminium producer outside China, did not reply to a Reuters request for comment. The Kremlin, which closely monitors tie-ups between strategic Russian companies, said it was unaware of merger plans.

Hong-Kong listed shares at Rusal rose by 11.35%, while Nornickel, the world's largest producer of palladium and refined nickel, was down 3.8% in Moscow.

Neither company has been directly targeted by Western sanctions imposed on Russia over the war in Ukraine, though Potanin himself was hit by British sanctions last week.

A tie-up would create a global base metals giant with combined revenue of $30 billion. Nornickel's palladium and nickel account for 40% and 7% of global mine production of these metals, respectively. Rusal produced 6% of global aluminium output in 2021.

Analysts said their combined clout could deter the West from imposing sanctions for fear of sending prices soaring for metals that are critical to its own industries.

The combined company would be "practically invulnerable to sanctions, as global markets are critically dependent on their products. Especially with the green agenda in mind," said Evgeny Kogan, professor at the Higher School of Economics in Russia.

'TOO BIG TO SANCTION'

"The argument 'too big to sanction' sounds plausible," said Maria Shagina, sanctions expert at the International Institute for Strategic Studies.

"I still think that the United States and the European Union are not ready for the repetition of the April 2018 sanctions on Rusal."

Rusal was subject to U.S. sanctions between April 2018 and early 2019 that caused a jump in global aluminium prices. Washington removed Rusal from the sanctions list when its founder Oleg Deripaska agreed to relinquish control of it.

Deripaska, still on the U.S. sanctions list, remains a powerful tycoon in Russia. His relations with Potanin are chilly.

Potanin and Rusal own 36% and 26% respectively of Nornickel, which had a market value of $49 billion at Monday's closing prices, according to Refinitiv Eikon data, compared with Rusal's market capitalisation of $15 billion.

DEAL MAKER

Potanin has swooped aggressively to grab new opportunities since Russia sent troops into Ukraine and the ensuing sanctions transformed the business environment.

His Interros group snapped up Rosbank from Societe Generale when the French lender exited the Russian market, before buying a 35% in TCS finance group at what its founder, Oleg Tinkov, said was a knockdown price.

The tycoon's public statement was unusual because he typically maintains silence until his deals are clinched.

His comments came less than a week after Britain slapped sanctions on Potanin and six months before the expiry of Nornickel's 10-year shareholder agreement that made him president of the miner - signals that the move was driven by multiple factors.

"Instead of leaving the company, as many other big businessmen have done recently [after Western sanctions on them], a more elegant solution may be found - to merge with Rusal," Kogan said on social media.

Interros Holding, which manages Potanin's assets, did not reply to a Reuters' request for additional comment.

The shareholder agreement, which expires on Jan. 1, covers the size of dividends at Nornickel which has been the main reason for on-and-off rows between shareholders at Nornickel and Rusal over the last 14 years.

The potential deal is a risk for Nornickel's future dividend payments and would provide limited financial synergies, analysts at BCS said in a note.

Potanin told RBC TV that the size of dividends to which investors at Nornickel have become accustomed in recent years will certainly not be available in 2022 nor presumably in 2023.

While Western sanctions have not directly targeted Nornickel, they have caused problems with trade finance and logistics.

"Potanin is flagging that they are under pressure from sanctions," said Tom Price, head of commodities strategy at Liberum in London. "Big miners always seek low-cost funding. But the ability of Russia's miners to do that has been severely restricted."
Reporting by Reuters; editing by Mark Trevelyan, Gareth Jones and David Evans

免責聲明: XM Group提供線上交易平台的登入和執行服務,允許個人查看和/或使用網站所提供的內容,但不進行任何更改或擴展其服務和訪問權限,並受以下條款與條例約束:(i)條款與條例;(ii)風險提示;(iii)完全免責聲明。網站內部所提供的所有資訊,僅限於一般資訊用途。請注意,我們所有的線上交易平台內容並不構成,也不被視為進入金融市場交易的邀約或邀請 。金融市場交易會對您的投資帶來重大風險。

所有缐上交易平台所發佈的資料,僅適用於教育/資訊類用途,不包含也不應被視爲適用於金融、投資稅或交易相關諮詢和建議,或是交易價格紀錄,或是任何金融商品或非應邀途徑的金融相關優惠的交易邀約或邀請。

本網站的所有XM和第三方所提供的内容,包括意見、新聞、研究、分析、價格其他資訊和第三方網站鏈接,皆爲‘按原狀’,並作爲一般市場評論所提供,而非投資建議。請理解和接受,所有被歸類為投資研究範圍的相關内容,並非爲了促進投資研究獨立性,而根據法律要求所編寫,而是被視爲符合營銷傳播相關法律與法規所編寫的内容。請確保您已詳讀並完全理解我們的非獨立投資研究提示和風險提示資訊,相關詳情請點擊 這裡查看。

我們運用 cookies 提供您最佳之網頁使用經驗。更改您的cookie 設定跟詳情。

風險提示:您的資金存在風險。槓桿商品並不適合所有客戶。請詳細閱讀我們的風險聲明