Rusal CEO and seven directors resign amid United States sanctions pressure

The company which produces pure aluminium ingots said that US sanctions could prevent it from repaying its debts

The company which produces pure aluminium ingots said that US sanctions could prevent it from repaying its debts Ilya Naymushin Reuters

"Rusal has been making progress in demonstrating it will meet conditions for relief from the USA sanctions - without which it can't operate normally", said Helen Lau, a Hong Kong-based metals and mining analyst at Argonaut Securities.

Earlier, Oleg Deripaska has left his position as president of the aluminum company Rusal and En+ energy group in order to head the Nornickel company, specializing in nickel and palladium.

Russia's largest aluminium producer, United Company Rusal Plc, said on Thursday its chief executive and seven board members have quit, and warned it may have problems servicing its debt due to the impact of USA sanctions. London-listed energy and resource conglomerate EN+ owns around 48.1 per cent of Rusal.

They are Vladislav Soloviev, Siegfried Wolf, Maxim Sokov, Dmitry Afanasyev, Gulzhan Moldazhanova, Olga Mashkovskaya and Ekaterina Nikitina.

In its statement, Rusal wrote: "Since April 2018, the company, acting in the best interests of its creditors, shareholders and partners, has been in continuous discussions with various authorities in an attempt to seek relief from the sanctions regime imposed by OFAC or to be removed from the Specially Designated Nationals list".

But restrictions on Deripaska could affect the operations of the Mykolaiv plant in southern Ukraine, which is the second-largest alumina asset of his aluminium business Rusal.

Ukraine has expanded sanctions against Russian companies and individuals, according to the sanctions list published on the Ukrainian presidential website on Thursday.

The United States announced sanctions on Rusal on April 6, preventing customers with USA exposure from continuing to buy Rusal's metal and sending aluminium prices to their highest in nearly seven years amid fears of a supply shortage. The new set of sanctions would target persons doing business in the Crimea and supplying weapons to Russian Federation.

Rusal posted a 22.4 per cent year-on-year rise in net profit for the year's first quarter to US$531 million, before the sanctions were imposed.

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