Special price for Deripaska

Prokhorov agrees to sell Norilsk Nickel to RUSAL for $3 billion cheaper than Potanin

The deal between Mikhail Prokhorov's Onexim group for the sale of a blocking stake in Norilsk Nickel to the united company RUSAL, which could take place at the end of December, is estimated at $3 billion less than a similar offer by Mr. Prokhorov to Interros, controlled by him partner Vladimir Potanin. This was reported to Vremya Novostey by a source close to the development of the parameters of the deal with RUSAL. According to his data, 29% plus one share of Norilsk Nickel is valued for RUSAL at $14.732 billion, while Mr. Potanin is offered to buy 25% plus one share for $15.7 billion.

According to the source, the deal between Onexim Holdings Limited (Nicosia, Cyprus), its affiliates and RUSAL involves two stakes in Norilsk Nickel. One of them - 25% plus one share - is valued at $12.7 billion. It is proposed to pay for 11% of RUSAL shares from an additional issue, which are valued at $5.562 billion, as well as cash in the amount of $4.438 billion plus “deferred “over time, part of the price in a total amount of approximately $2.7 billion, subject to certain adjustments, plus interest,” according to the explanations for the transaction, available to Vremya Novostey.

The second package - "as part of the same deal" - is about 4% of Norilsk Nickel shares. What kind of package this is is not known for certain; perhaps it refers to Mr. Prokhorov’s share in Norilsk Nickel shares registered with KM Invest (this company is owned by Messrs. Prokhorov and Potanin on a parity basis). RUSAL, according to explanations, agreed to purchase this package for $2.032 billion at the time of completion of the transaction with the first package.

In addition, the explanations specifically note the fate of the shares of the Energopolyus company if it is created. As you know, on December 14 an extraordinary meeting of Norilsk Nickel shareholders will be held, at which the issue of reorganizing the company by separating its electric power assets into a separate structure, Energopolyus, will be considered. If a positive decision is made, then along with 25% and one share of Norilsk Nickel, RUSAL will also receive shares of Energopolyus. However, RUSAL, according to the explanations to the transaction, has the right to return these electricity shares to Onexim and in this case reduce the deferred part of the payment by “$2 billion (plus interest).” However, sources in RUSAL previously told Vremya Novostey that they very seriously expect to become the owners of Energopolyus, and therefore are unlikely to return these shares to Mr. Prokhorov.

RUSAL and Onexim yesterday refused to comment on the parameters of the deal. Meanwhile, Onexim's offer offered Interros to buy 25% plus one share of Norilsk Nickel for $15.7 billion - a press release from Mr. Prokhorov's company noted that this price was based on average share prices for the last month plus a premium of 12.5%. Mr. Potanin can accept this offer until December 21. But judging by reports from sources in the banking market, he is unlikely to do this: lending is now too expensive, and Mr. Potanin clearly cannot afford to pay more than RUSAL and receive fewer shares.

The director of the Interros public relations department, Larisa Zelkova, claims that “the partners have no formal obligations to each other to sell the stake in Norilsk Nickel.” Consequently, the statement in the Onexim press release that the “right of first refusal” of the group’s stake “is granted exclusively to Vladimir Potanin and the persons controlled by him” is nothing more than the simple will of Mr. Prokhorov. This was confirmed yesterday by a Onexim representative. “There are no legal requirements to send such proposals,” he told Vremya Novostei. -- This proposal is correct in relation to the other shareholder of Norilsk Nickel.

However, Mr. Prokhorov’s proposal for Mr. Potanin to buy a blocking stake in Norilsk Nickel at almost a quarter more than for RUSAL looks very strange. However, Mr. Prokhorov does not think so. In one of his last interviews, he said: “I don’t think that my proposal is rigid or non-market. We set the deadlines for dividing the assets together almost a year ago; this price repeatedly appeared during our consultations and was not a surprise to him. It is important for him to have the right to choose. I gave it to him."

Nikolay GORELOV, Irina TSYRULEVA