7 Nov 2011 10:12

Minority holders to get some $550 mln from NN Investments - source

MOSCOW. Nov 7 (Interfax) - The holders of minority share and ADR interests in Norilsk Nickel of 100 or fewer shares or one thousand ADR or fewer that have offered them for buyback will receive around $550 million from NN Investments, a source close to Norilsk Nickel told Interfax.

A quasi-treasury stake in the company held by Corbiere (9.23%) was not involved in the buyback, the source said. "The quasi-treasury stake was not involved in the buyback, as there was no sense in it," the source said.

Two market sources said earlier that Norilsk Nickel estimates its expenditure on buying out shares from minority shareholders at $306 million, although analysts reckon that holders of blocks of shares that are to be bought back completely should get between $550 million and $585 million.

Norilsk Nickel subsidiary NN Investments bought back 7.7% of shares in the mining giant after receiving tenders for 62.8% of shares during the buyback offer from September 28 to October 28. The buyback ratio was about 10.95%, the lower end of the expected range.

A number of market participants speculated that the heavy participation of Norilsk Nickel shareholders in the buyback could be partly due to the participation of Corbiere. Rusal, which owns a 25% stake in the miner, reckons Norilsk Nickel "used quasi-treasury shares in the buyback to reduce the buyback ratio for minority shareholders."

Rusal said that, based on NN Investments figures, minority shareholders tendered 1,797,385,600 shares, or the equivalent of nearly 18,000 tenders of 100 shares each. "However, in a month of strenuous work the largest Moscow office of Computershare managed to accept just 1,881 tenders. The registrar could not have physically processed such a number of tenders from regular minority shareholders," the aluminum giant believes.

"It's perfectly obvious that quasi-treasury shares, which the management of Norilsk Nickel and Interros used to reduce the buyback ratio of minority shareholders, took part in this buyback," Rusal said.

Norilsk Nickel has not disclosed the participants in the buyback.

A source close to Norilsk Nickel said the buyback ratio is the same for all participants in the buyback, and any single shareholder, including Interros, could not achieve a higher ratio by splitting up its stake and submitting multiple tenders.