A FEUD between two Russian billionaire shareholders in UC Rusal, the world’s biggest aluminium maker, will be aired in a London court, the company has said, with a $47 billion supply deal in the balance.
Minority investors led by Viktor Vekselberg, who quit as chairman last month, are already in dispute with chief executive and main owner Oleg Deripaska, the former physicist who came out on top in the scramble for aluminium assets after the Soviet Union collapsed, for his refusal to sell the company’s stake in Arctic miner Norilsk Nickel, which has since tumbled in value.
A source close to a Rusal shareholder said last week that Mr Vekselberg’s investment firm Sual Partners, which has 15.8 per cent of Rusal, was opening a fresh dispute over the giant supply deal between Rusal and commodities trader Glencore.
Sual, which Mr Vekselberg runs with partner Len Blavatnik, claims the deal was struck in violation of its right of veto and is suing Rusal, Glencore, Mr Deripaska and his holding company En+, through which he owns 47.4 per cent of Rusal.
While not directly related to the feud over Norilsk Nickel, the legal action marks an escalation in Mr Vekselberg’s campaign against Mr Deripaska, in turn part of a wider clash between Russia’s metals oligarchs, who made their fortunes from the corpse of the Soviet command economy in the 1990s.
Mr Deripaska’s own net worth was effectively wiped out when the markets turned during the financial crisis, one banker close to him has told Reuters, and Rusal had to restructure the debt burden it took on to finance the Norilsk deal he had driven through.
Rusal said the clash over the supply deal would be heard by the London Court of International Arbitration, a disputes resolution forum provided for in the Rusal shareholders agreement.
“The company has engaged counsel to advise the company in the arbitration and will vigorously defend its position,” Rusal said in a statement. “The company does not expect its involvement in the arbitration would have any material adverse impact on its operations.”
Under the rules of the arbitration court it is required to respond to arbitration requests within 30 days. In the event of a favourable response, a tribunal can be formed to review the case. Proceedings are typically lengthy. – (Reuters)
