Planned 8.75% stake swap with aluminium tycoons firm cancelled after new US sanctions
Glencore, the world's largest commodities trader, has begun cutting its ties with the Russian aluminium tycoon Oleg Deripaska after new US sanctionsagainst his business empire.
Glencore said it had cancelled the schemed swap of its 8.75% stake in the Russian aluminium maker Rusal, which is controlled by Deripaska, for shares in the London-listed En+ Group, another of the oligarch's companies.
Glencore's chief executive, Ivan Glasenberg, has also resigned from the Rusal board. The Swiss-based commodities trader said it was evaluating other contracts with Rusal. It bought $2.4 bn( PS1. 7bn) of aluminium from Rusal in 2017 under a multi-year deal that is due to be renegotiated this year.
” Glencore is committed to complying with all applicable sanctions in its business and is taking all necessary measures in order to mitigate any risks to Glencore's business ,” it said.
” Glencore is still evaluating the position under its contracts with Rusal, but notes that these contracts are not financially material to Glencore .”
The plunge came even though the Russian central bank chief, Elvira Nabiullina, said the country's economy could withstand the latest US sanctions.
” The central bank has a broad spectrum of instruments in order to act in such situations, if dangers arise to financial stability. In our view, there are not such risks now ,” Nabiullina told a conference in Moscow.
” There is no required to take some kind of systemic measures. Of course we will follow the situation and perhaps introduce some revisions if there is reason .”
Shares in Glencore fell 2% on Friday when US sanctions on seven Russian oligarchs and 17 top government officials were announced, and a further 3.4% on Monday, with investors fretting over the impact on the company's aluminium business. On Tuesday, the shares rallied as much as 4.6% after some analysts said there would be little impact.