Norilsk takes power spin-off from board agenda
"UC RUSAL also would also like to take this issue off of the agenda for the shareholders' meeting. We will consult with our shareholders about the long-term fate of our electricity assets," said the spokeswoman, Yelena Kovalyova.
UC RUSAL, the world's largest aluminium producer, released a statement later on Wednesday voicing its opposition to the spin-off.
"We believe that non-core assets should be sold in a manner that provides all shareholders with a proportionate share of the consideration received from the sale," the statement said.
"The spin-off may cause widespread selling of Norilsk Nickel shares because most investors are not focused on the energy sector in the current market situation. This will lead to a further decrease in the shares of energy assets, which may lead to a decline in the value of Norilsk Nickel," it said.
Norilsk's management committee decided on Monday to recommend that the board spin off just one power generator, OGK-3 (OGKC.MM: Quote, Profile, Research, Stock Buzz), and sell its remaining electricity assets.
The board was meant to discuss the issue on Wednesday.
Norilsk, the world's largest nickel producer, has spent billions of dollars on power assets in recent years, banking on the further liberalisation of the electricity market, with the biggest purchase being a $4.6 billion acquisition of OGK-3 (OGKE.MM: Quote, Profile, Research, Stock Buzz).
But the Norilsk strategy ran into trouble after top owners Vladimir Potanin and Mikhail Prokhorov failed to find a compromise over how to split their assets during a long corporate divorce.
Prokhorov last year blocked the spin off of all the company's energy assets into a separate company. But after he had sold his stake in Norilsk of 25 percent plus two shares UC RUSAL, the spin-off issue was raised again.
In May, both Potanin and UC RUSAL backed the spin off with the aim of creating more value for Norilsk shareholders.
According to Uralsib investment bank, Norilsk currently owns 79.1 percent of OGK-3, 1.8 percent of OGK-5, 1.7 percent of TGK-5, 27.8 percent of TGK-14, 7.4 percent of TGK-1, 24.8 percent of Kolenergo, 24.8 percent of Kola Sales company, 8.2 percent of the Federal Sales Company and 25.5 percent of TyvaEnergo. (Reporting by Polina Devitt; Writing by Simon Shuster; Editing by Quentin Bryar)