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. Last Updated: 07/27/2016

UES's Minority Investors Gain Ground on Charter

Minority investors in Unified Energy Systems have negotiated an agenda for an extraordinary meeting of shareholders with board chairman Alexander Voloshin, who is also Kremlin chief of staff, the head of an asset management company said Wednesday.

Voloshin "basically agreed with the principle of strengthening the charter of Unified Energy Systems," Hermitage Asset Management chief Bill Browder told fellow UES investors.

"He as chairman of the board would call for a new EGM [Extraordinary General Meeting] if we agreed to work with his team to redraft the EGM proposals," Browder said, referring to the extraordinary meeting.

However, Browder also said: "Although [the agenda] was agreed by Voloshin … 10 days ago, 10 days can be a long time in Russia. Until we see them call this EGM, it's not a done deal."

Vedomosti reported Thursday a source in the presidential administration as confirming that Voloshin had agreed to hold an EGM. However, Voloshin himself later denied this in a written statement sent to the newspaper.

Voloshin agreed to put to a vote measures strengthening board control over asset sales and shareholder control over the hiring and firing of UES chief Anatoly Chubais, Browder said.

Chubais is pressing ahead — with government approval — with the restructuring of the nation's utilities.

He has proposed to spin off generating, distribution and marketing functions into separate companies. But minority investors have opposed the plan, saying it might let UES management sell off assets on the cheap.

They proposed a vote to sack Chubais last summer, but failed to bring about an EGM.

Browder said Voloshin agreed to put on the new EGM agenda a measure that would bar UES management from selling assets effectively worth more than 4 percent of UES's value or shares in UES units without approval from two-thirds of the board.

(Reuters, MT)