- Two Russian billionaires clash on governance at the world's largest aluminium company,
- Viktor Vekselberg said Rusal was in "deep crisis" because of bad management
- Oleg Deripaska, Rusal's chief executive, said 'there is no crisis'
Two Russian billionaires have clashed publicly over corporate governance at the world's largest aluminium company, after Viktor Vekselberg said United Company Rusal was in "deep crisis" because of bad management and a heavy debt load.
Mr Vekselberg resigned as Rusal's chairman on Monday night, saying it had been transformed from "a world leader in the aluminium industry into a company overburdened by debt and involved in a huge number of legal battles and social conflicts".
Oleg Deripaska, Rusal's controlling shareholder and chief executive, hit back at Mr Vekselberg on Tuesday. "There is no crisis, either deep or shallow. There is a difficult situation on the market which determines the economic results," he said, adding that Rusal would replace him with an independent chairman.
Rusal, which suspended its Hong Kong-listed shares on Tuesday, had earlier said that Mr Vekselberg failed "to perform his duties as a public company board chairman". A spokesman for Mr Vekselberg declined to comment on Rusal's accusation.
Rusal's shares were down over 3 per cent as trading resumed Wednesday morning in Hong Kong.
Falling aluminium prices and heavy debts have cast a cloud over Rusal since it launched an initial public offering on the Hong Kong stock exchange in early 2010.
The company attracted large investments from the financier Nathaniel Rothschild, hedge fund manager John Paulson and two of Asia's richest men, Hong Kong-based billionaires Li Ka-shing and Robert Kuok. The stock is now 43 per cent below its IPO price. Rusal's IPO was controversial in the Chinese territory because of corporate governance concerns, and regulators initially restricted its sale to retail investors.
Rusal's banks, which could have called in the company's loans if aluminium prices continued to fall, gave it a 12-month reprieve in January. Mr Deripaska said the agreement would allow Rusal to service its $11.4bn debt.
Mr Vekselberg co-owns a 15.8 per cent stake in Rusal with another Russian oligarch, Leonard Blavatnik. Mr Vekselberg and Mr Deripaska have also been at odds over whether Rusal should sell its 25 per cent stake in Norilsk Nickel, the world's biggest nickel miner.
Mr Vekselberg has been seeking to sell many of his Russian assets over the past year, and supported a $12.8bn offer from Norilsk to buy back most of Rusal's stake.
The deal, made at a big premium to the market price at the time, would have allowed Rusal to pay off its $11.4bn debt burden and begin paying dividends to shareholders. But Mr Deripaska, who sees Norilsk as a "strategic asset", refused to sell.
A person close to one of the shareholders claimed the problems had broken out over a potential sale of Mr Vekselberg's stake in Rusal.
Mr Deripaska declined to comment on which shareholders Mr Vekselberg had been in discussions with. He said: "[Mr Vekselberg] has been receiving proposals all the time, but he always refuses them and raises the price."