MMC Norilsk Nickel approved buyback by a majority vote. But price and volume are not yet determined. The board of directors decided that first Norilsk Nickel would make an offer to Oleg Deripaska’s Rusal, which owns 25% plus one share of MMC.

According to The Russian Mafia web-site (, in February Norilsk Nickel offered Deripaska's company to sell 20% for 12.8 billion dollars. Thus, the price per share was 335.7 dollars. Such a price offered a 40% premium compared to the market, but Rusal refused.

 Rusal says that buyback by Norilsk Nickel is not aimed at implementing the interests of all shareholders of MMC, but promotes only the interests of Interros, controlled by Vladimir Potanin. "The fact that management of Norilsk Nickel was instructed to make another offer to Rusal before the announcement of an offer to all shareholders is a further proof of the alleged buyback not to be aimed at increasing the capitalization of MMC, as stated by Interros, but only Interros seeking to obtain full control of the MMC and its cash flows," said Rusal in its press release. In this situation, Rusal intends to defend its rights by any lawful means, including criminal prosecution of both Interros and Norilsk Nickel top management.

Recently, the influence of Deripaska in Norilsk Nickel has weakened considerably. In addition, he may experience pressure from other shareholders like Viktor Vekselberg’s SUAL Group and Mikhail Prokhorov's Onexim, if they see that the sale of Norilsk Nickel shares pursues the interests of the company. On the other hand, Norilsk Nickel package for Deripaska is a strategic investment and he is resentful to sell it. He has already refused an offer with a big premium, and Norilsk Nickel is unlikely to offer more.

But this time Norilsk Nickel has an additional argument. Market experts predict that during the next buyback about 4-5% of Norilsk Nickel shares would be purchased and then retire the equities. Interros offers retire the shares acquired through buyback. This will reduce the total number of shares and will automatically increase the percentage of all shareholders. As a result, Interros and MMC shareholders that support it (namely, management of Norilsk Nickel, which owns 9.2% stake and Dutch raw materials trader Trafigura, which owns 8.05%) will control more than 50% of the company.