Glencore will break off cooperation with Rusal

The Swiss trader will establish cooperation with the Russian aluminum company. Under threat will be up to a quarter of primary aluminum sales of "Rusal".
10.04.2018
Kommersant
Origin source
As expected in the market, the Swiss trader Glencore suspends the deal to exchange its stake in RusAl for shares of En + Group Oleg Deripaska (controls Rusal from 48.13% of shares) in the light of US sanctions against Russian companies and businessmen. And the head of Glencore Ivan Glazenberg left the board of directors of "Rusal". Whether Glencore will leave the capital of Rusal is not yet known, but the trader has already said that he assesses the prospects of trade contracts with the aluminum company - they make up only 1% of Glencore's revenue, but they provide a quarter of the proceeds to Rusal.

Swiss trader Glencore stops the conversion of its 8.75% stake in Rusal into 10.55% of global receipts of En + Group Oleg Deripaska (owns 48.13% of Rusal) in light of the inclusion of both companies in the SDN list by the US Treasury. Glencore head Ivan Glazenberg, for the same reason, withdrew from the board of directors of Rusal, which he joined since 2007 - after the merger of aluminum and alumina assets of Russian Aluminum, Oleg Deripaska, SUAL Viktor Vekselberg, Leonard Blavatnik and partners, and Glencore in United Company Rusal.

The trader said that he assesses the situation with respect to trade contracts with Rusal, but notes that "these contracts are financially insignificant for Glencore". Trader's revenue for 2017 was $ 221.4 billion, adjusted EBITDA - $ 14.76 billion.

However, Glencore's sales account for about a quarter of Rusal's revenue from the sale of primary aluminum and alloys (3.95 million tonnes last year): in 2017 it was $ 2.43 billion, in 2016 - $ 2.32 billion. The customer base of aluminum The company is diversified and includes only one large buyer - Glencore, stated in the reports of "Rusal". At the same time, purchases of bauxite, alumina and other materials from the Swiss trader are insignificant - in total purchases of this raw material from "related parties with significant influence" (up to 90% accounted for by Glencore) in 2017 amounted to $ 113 million, in 2016 - $ 143 million. Sales bauxite and alumina to "related parties with a significant share of the impact" a little higher: $ 227 million and $ 186 million in the past and two years ago.

About a possible breakdown of the En + c Glencore deal and difficulties in trade contracts, sources told Kommersant earlier (see "Kommersant" on April 7). In En + and Rusal, they did not immediately comment on Glencore's statement and Mr. Glazenberg's exit from the board of directors of Rusal. The representative of Glencore on Monday, April 9, refused to answer questions to Kommersant on these topics and the prospect of the trader's exit from the share capital of Rusal.

At the end of 2017, the share of Glencore in "Rusal" was $ 933 million, according to a trader's report. But after the introduction of sanctions against Oleg Deripaska and his companies on April 6, Rusal almost doubled, and at the price of Rusal on the Moscow stock exchange at 12:30 on April 10, the Glencore package in the aluminum company was worth about $ 470 million. At the same time, investors reacted with restraint to the expected statement of the trader: the paper "Rusal" in Moscow fell by only 2.35%.

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