Business

Rusal chairman slammed by owner over resignation

Wednesday, March 14, 2012    

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MOSCOW, Russia - A bitter war of words broke out yesterday between two of Russia's richest men after Viktor Vekselberg quit as chairman of Rusal, the world's largest aluminium producer.

The resignation marks an unusually public spat among the secretive ranks of Russia's corporate community and prompted a rebuke of Vekselberg's conduct as chairman by fellow billionaire Oleg Deripaska, who controls Rusal.

Rusal, which is valued at around (euro) 12 billion ($1.35 trillion), requested a suspension in its shares as the resignation was announced. At the time, they were trading 1.3 per cent lower on the day on the Hong Kong Stock Exchange.

In a statement posted on his Renova holding company late Monday, Vekselberg said mismanagement at Rusal has wrought devastating damage on the company.

"Rusal has, in my opinion, deteriorated from an international aluminum leader into a company overburdened with debt and entangled in numerous lawsuits and social conflicts," he said.

Vekselberg is Rusal's third-largest shareholder and holds a 15.8 per cent stake in the company. He had chaired the board of the world's largest aluminum producer since its founding in 2007. Rusal's debt at the end of September stood at US$10.9 billion ($948 billion).

In a statement, Rusal, which is 47 per cent owned by Deripaska's holding company, indicated that Vekselberg had jumped before he was pushed. The company noted that Vekselberg had failed to attend any live board meetings since February last year and had missed the annual shareholder meeting in June.

"The decision of Mr Vekselberg to resign as chairman of the board pre-empted the anticipated consideration of this matter by the board," Rusal said.

An independent director will be appointed to replace Vekselberg, Rusal said.

Vekselberg, whose personal wealth is estimated at US$12.4 billion by Forbes magazine, came to prominence in the 1990s as a member of the powerful business community, known collectively as oligarchs. He owned and ran an array of oil and metals assets before winding up most of his business activities in 2010 to focus on the state-sponsored Skolkovo innovation center.

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