Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Minister Asks Court to Remove Chubais

Deputy Energy Minister Viktor Kudryavy, a UES shareholder and an arch critic of its chief executive, Anatoly Chubais, has filed suit in the Moscow Arbitration Court in an effort to force the UES board of directors to call an extraordinary shareholders meeting to elect a new CEO.

Kudryavy filed the suit April 29, one day before Chubais' five-year contract expired. He asked the court to suspend Chubais while considering his suit.

UES board chairman Alexander Voloshin, who heads the presidential administration staff, extended Chubais' contract in March, although UES announced it only April 29.

Kudryavy argues that Chubais is not legally the company's CEO. "In 1999, the UES charter was changed and now, according to the charter, the CEO is to be elected at a general shareholders meeting," RIA Novosti quoted Kudryavy as saying Wednesday.

Ironically, it was Kudryavy, as chairman of the UES board, who signed Chubais' first contract in 1998.

Even if Kudryavy succeeds in getting the extraordinary shareholders meeting, however, there is little hope of unseating Chubais, as he enjoys the support of the government, which controls UES. But by filing the suit, Kudryavy may be hoping somehow to improve his chances of winning back a seat on the UES board at the annual general shareholders meeting scheduled for May 30.

UES spokesman Andrei Yegorov said Wednesday the company would not comment until it received information about the suit from the court.

Yegorov said, however, that in the event Chubais is suspended, his first deputy Leonid Melamed, who is board member and has all signature rights, would become acting CEO.

Kudryavy also filed a separate suit challenging the ongoing reform of Unified Energy Systems. He asked the court to annul a May 7, 2002, decision by the UES board approving the contribution of property and funds to the charter capital of the new Federal Grid Co. without giving the government a single share in the company. Under the government's restructuring plan, the Federal Grid Co. is to remain a state monopoly.

"They took very important assets, created a separate company, but did not give the government a single share," he said. "The government is losing a very important strategic object. I am trying to get it back."

Kudryavy has tried to block many, if not all, of the reform initiatives of UES management. He categorically opposes the UES restructuring plan and has called publicly for Chubais and his entire management team to be sacked.

A deputy energy minister since 1997, Kudryavy was a UES board member for years before he lost his seat last year.

National Reserve Bank, which owns about 4 percent of UES, nominated 13 candidates for the UES board, including Kudryavy and Chubais.

Kudryavy sued because only shareholders holding at least 2 percent of a company can put an issue on the agenda of an annual meeting, and 10 percent of shareholders are needed to call an extraordinary meeting. The issue is not on the agenda of the May 30 meeting.