MIKOM Sells 66% of Novokuznetsk

The Metallurgical Investment Co., or MIKOM, has sold a 66 percent stake in the Novokuznetsk aluminum smelter to Grigory Luchansky, an investment entrepreneur who heads the Center for Investment Projects and Programs.

Luchansky said he plans to try to end a yearlong struggle between MIKOM and the expansion-minded owners of the Russian Aluminum holding over control of the smelter and then sell his stake to the highest bidder.

"For us, the purchase of the shares of the Novokuznetsk aluminum smelter is an investment project," Luchansky said. "So far a decision has not been made as to who will be the next owner of the shares."

Sixty-six percent of the shares in the Novokuznetsk smelter had belonged to four companies affiliated to MIKOM and will now belong to four companies controlled by Luchansky.

Luchansky did not say how much he paid for the stake.

He said his Center for Investment Projects and Programs would eventually handle the sale of the shares, possibly to Russian Aluminum. "I do not deny that Russian Aluminum may have higher chances than most potentially interested parties," Luchansky said.

The battle over the smelter started last year when Siberian Aluminum tried to buy a controlling stake.

But Siberian Aluminum got a stronger hand after it teamed up with a group of shareholders in oil major Sibneft to form metals heavyweight Russian Aluminum. That holding controls 75 percent of the nation’s aluminum output.

Russian Aluminum managed to get external management imposed on the debt-ridden plant in January, and it then appointed its own officials to a new management board.

MIKOM and Russian Aluminum have since then been at war. Among the blows, Russian Aluminum-appointed directors neglected to include MIKOM owners on a register of factory creditors. MIKOM seized the smelter’s products and won a court ruling declaring the external management as unlawful.

But Luchansky said his main job now is to find a compromise at the plant. He is already holding negotiations with Viktor Belyayev, the executive director of Russian Aluminum, and MIKOM vice president Dmitry Chirakadze.

Officials close to the talks said the resolution being favored at negotiations would see Russian Aluminum paying MIKOM appropriate compensation, and MIKOM then calling off its court appeals against the factory and external management, said officials close to the negotiations.

Both Luchansky and Belyayev say the parties have reached an initial agreement: An audit will be carried out of the the smelter’s creditor and debtor liabilities to determine exactly how much money it owes MIKOM.