Thursday 6 February 2020 2:22 pm

Aluminium group EN Plus to buy back a fifth of shares

Russian aluminium and power producer EN Plus said it would buy back a fifth of its shares from state bank VTB for $1.6bn (£1.24bn) in response to the US lifting sanctions on the group.

Oligarch Oleg Deripaska, who has close ties to Russian president Vladimir Putin, offloaded his controlling stake in EN Plus to VTB in January in order for the group to escape tariffs.

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Former UK energy minister Gregory Barker, who is EN Plus’s chairman, was integral in lobbying for the removal of the sanctions.

The company said that the planned buyback from VTB was line with Barker’s plans. In a statement, he said:

“The shares acquired secure future optionality to pursue our strategy to create a global, integrated low-carbon aluminum producer and the opportunity over the longer term to expand our institutional shareholder base”.

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EN Plus will buy the shares for $11.57 each, which “represents a significant discount on [the firm’s] fundamental valuation”, he added.

Russian-owned Sberbank will lend EN Plus $1.8bn in order to cover the planned buyback, which will help Barker’s attempts to reposition the firm as an environmentally friendly producer.

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Deripaska, against whom the US has levelled sanctions due to his links to the Kremlin, still owns 44.95 per cent of the firm, but holds just 35 per cent of the voting rights.

The oligarch has undertaken similar moves in the past to avoid sanctions. In May 2018 he stepped down as president of steel giant Rusal, which he founded, to have sanctions removed.