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Russia's Norilsk Nickel embroiled in a shareholder row is mulling
Russia's Norilsk Nickel embroiled in a shareholder row is mulling an option to consolidate with a top Russian metals firm instead of merging with aluminum giant RusAl, business papers said Wednesday.

Andrei Klishas, chairman of the Norilsk Nickel board of directors, was quoted by Kommersant as saying that he had received a letter from Dresdner Kleinwort with a proposal to consolidate the world's biggest nickel producer with Metalloinvest owned by Russian billionaire Alisher Usmanov.

"We sincerely believe this consolidation will create considerable shareholder value for the company," Igor Lozhevsky, chairman of Kleinwort Dresdner's banking service and capital markets division for Russia, told Vedomosti, adding that the investment bank was not yet an official consultant either for Norilsk Nickel or Gazmetal whose assets are managed by Metalloinvest.

Mikhail Prokhorov and his former business partner Vladimir Potanin are two key shareholders of the metals giant Norilsk Nickel. As of late 2007, they held 28.2% and 25.3% of Norilsk Nickel's shares, respectively. Both businessmen announced plans early in 2007 to divide the assets but eventually failed to agree on the business's division.

Late in 2007, Russia's newly created aluminum giant United Company RusAl received an offer from Prokhorov to buy out his blocking stake of 25% plus one share in Norilsk Nickel.

UC RusAl, which became the world's largest aluminum producer after a March 2007 merger between aluminum firm RusAl, rival Sual and Swiss Glencore's alumina assets, is expected to close a deal in February-March, Vedomosti said.

Klishas told Kommersant that different options were available to carry through Dresdner Kleinwort's offer: Norilsk Nickel could buy a blocking stake in Gazmetal or acquire the company through the issuance of new shares.


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