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. Last Updated: 07/27/2016

Court Nixes Norilsk Nickel Auction Suit

Combined Reports

A Russian court Tuesday rejected a bid by metals giant Norilsk Nickel to rule illegal last fall's auction of a 38 percent stake under the government's loans-for-shares scheme, a State Property Committee spokesman said.

The suit was filed last week in the Moscow Arbitration Court by the company management, which has been trying to annul the hotly disputed auction, in which Uneximbank acquired management rights to a 38 percent stake in Norilsk Nickel in return for a $170.1 million loan to the government.

A Norilsk lawyer told NTV the company would appeal the ruling within 30 days.

Uneximbank has tried to use its stake to change what it regards as inefficient management, and has been trying to win the backing of trade unions in return for higher wages.

State Property Committee spokesman Igor Plotnikov lauded the decision.

"Now it is clear that it is impossible to annul privatization legally," he said in an interview.

The ruling also overturns a ban on an extraordinary shareholders' meeting, called by the bank to discuss changes to Norilsk's board, charter and business strategy. The meeting had been banned earlier by the same arbitration court.

The dispute over Norilsk, a giant firm which produces nearly a fifth of the world's nickel and cobalt and 42 percent of the global platinum supply, has focused attention on the whole privatization process. The communist-domintated State Duma voted last week to begin an investigation of the Norilsk selloff and its fallout. ()