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. Last Updated: 07/27/2016

Norilsk Posts Gain, Will Issue ADRs

Russia's giant Norilsk Nickel company reported Monday that pre-tax profits more than doubled last year and said it was prepared to fight a big shareholder seeking management changes.

It also announced plans to tempt Western investors with an issue of American Depository Receipts, share look-alikes backed by company equity that can be purchased abroad.

Officials from Norilsk, one of the world's biggest nickel, platinum and palladium producers, said nickel production rose nearly 11 percent last year.

But Norilsk is locked in a dispute with commercial bank Uneximbank, the temporary guardian of a 38 percent stake in the company. Economy director Vladimir Mekhanik said Norilsk had appealed to First Deputy Prime Minister Oleg Soskovets to sort out the quarrel and a meeting could take place soon.

"We understand they have the right to claim concrete functions in terms of management, but we have conditions. There should be a parity and balance of interests and the issue is how we will jointly manage the shares," he said.

The firm reported pre-tax profits of 5.47 trillion rubles ($1.16 billion) in 1995, after 2.11 trillion in 1994.

Vladimir Mekhanik, Norilsk's finance and economics director, said Monday that the company is "now in the first stage of issuing ADRs with Bank of New York and Merrill Lynch," a move that could attract significant foreign capital to the firm. He said Coopers & Lybrand was auditing the company to international standards, and that the task would be finished before a planned Norilsk shareholders meeting in May.