Worth a nickel

26 November 2008 By Pierre Briancon

The Russian government has imposed a truce and will call the shots at the world s largest nickel company, torn by a feud between two oligarchs. This should allow Norilsk to focus on shrinking markets and falling prices. But minority investors have no reason to cheer.

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Oleg Deripaska and Vladimir Potanin, two of Russia's richest and bestknown oligarchs, this week agreed to a governmentimposed truce in their boardroom fight over the fate of Norilsk Nickel, the world's largest producer of nickel and palladium and a leading producer of platinum and copper.

Both men agreed on the composition of a new board, to be elected at a shareholders meeting in December. Interros, Potanin's holding company, which owns 30% of Norilsk, and Deripaska's Rusal, the world's leading aluminium producer, which bought a 25% stake in Norilsk in April, will each appoint four directors, and agree on three independent board members. The Russian government, which bailed out Deripaska earlier this month on a $4.5bn loan he had taken from western banks, will also appoint a director. Potanin and Deripaska will not sit on Norilsk's board. The chairman of the company will be chosen from among the "independents", but according to Russian media will in fact be the government's representative.

Norilsk Nickel shares are down 65% since early August.

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