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. Last Updated: 07/27/2016

Norilsk to Pass Debt to Spinoff

BEIJING -- Norilsk Nickel will transfer 15 billion rubles ($610 million) of debt to the $7 billion energy firm it plans to spin off this year, the company's chief executive said Wednesday.

Denis Morozov said the new energy firm, called EnergoPolyus and scheduled to list shares in Moscow and possibly London by May, would be able to repay this debt within two years of its creation.

"It's going to be 15 billion rubles. That's decided and that won't change," Morozov said when asked about the energy company's debt.

"I think it's the right decision to de-leverage Norilsk and re-leverage this company. The new company will have enough extra resources and enough assets to repay its debt within the next two years," he said on the sidelines of a mining conference and added that Norilsk Nickel's net debt was around $6 billion.

In a memorandum on the spinoff published Wednesday, Norilsk said each of the two had accumulated more than a blocking stake of over 25 percent in the company. Prokhorov, the president of the investment fund Onexim Group, owned a 28.2 percent stake in Norilsk, while Potanin, president of Interros banking and industrial group, had 25.3 percent, it said.

Prokhorov had originally said he would control Norilsk's noncore energy assets while Potanin would buy out his stake in the mining company. Russian media have reported that Prokhorov might vote to block the spinoff at a Dec. 14 shareholders' meeting.