The Government has considered a range of options for saving Rusal's Aughinish Alumina plant , sources confirmed on Friday evening. The news emerged as Rusal's controlling Russian oligarch shareholder, Oleg Deripaska, agreed in principle to relinquish control of the aluminium producer by selling down his stake in parent company EN+.
Bloomberg reported earlier on Friday that after the US imposed sanctions on Rusal and Mr Deripaska, the possibility of trying to broker a change of ownership or taking over the Aughinish Alumina plant in Co Limerick were briefly considered before being dismissed for now.
Sources confirmed this, stressing that no plan had been developed into a serious proposal. The plant near Askeaton employs some 450 staff.
Authorities have little desire to intervene directly in the ownership issue and the Government is focusing on its efforts within the European Union to limit the effects of the sanctions if they come into play, Bloomberg reported.
This week, the pressure for action eased after the US made clear international companies could continue to deal with Rusal under existing contracts until October.
Shannon estuary
The Aughinish plant on the banks of the Shannon estuary is a key link in the global industry. It buys bauxite from Guinea, refines it into alumina, and then sells that to aluminum makers such as Rio Tinto Group and Liberty House Group.
“The Government continues to closely monitor developments, collaborating across departments, as the situation evolves,” the Department of Enterprise said, declining to comment on specific options being considered.
Mr Deripaska’s latest proposal, announced in a statement to the London Stock Exchange on Friday afternoon, has yet to be accepted by the US Treasury, which imposed sanctions on the prominent oligarch and his companies this month, as part of what the Trump administration described as a broad response to Russia’s “malign activity”.
In the statement, EN+ said: “Mr Oleg Deripaska has agreed in principle to the chairman’s request that Mr Deripaska reduce his shareholding in the company to below 50 per cent ”.
Although the response from Washington is key, much will also depend on whether the Kremlin is prepared to back the proposal, which would see one of Russia’s highest profile businessmen severed from his assets under US pressure.
Under the proposed deal Mr Deripaska would reduce his stake in EN+, which serves as the holding company for his assets, from above 70 per cent to below 50 per cent. The company listed on the LSE last November in a $1.5 billion (€1.2 billion) flotation.
EN+, which is chaired by former UK energy minister Greg Barker, would also overhaul the board under the proposal, removing Mr Deripaska and adding new directors without links to the oligarch.
‘Logical conclusion’
EN+ would also give up its rights to nominate the chief executive of Rusal and manage the business.
“If the plan is accepted the logical conclusion [for the US Treasury] will be to release Rusal from these sanctions,” a person familiar with the situation said. “Mr Deripaska has agreed to sever the link. He does not want to see the company he has built up crumble.”
Rusal also said on Friday it will overhaul its board and management in the hope the US will remove the aluminium firm from the sanctions list so it can restart shipments to its customers around the world, according to sources.
Additional reporting: Reuters/Bloomberg/Financial Times
