Shares in mining giant Evraz have been suspended after they dropped 11 per cent this morning, following the government’s decision to sanction major stakeholder Roman Abramovich.
The Russian billionaire has a 29 per cent stake in the company, but has seen all of his assets frozen by the government this morning – including Chelsea Football Club.
When outlining its rationale for sanctioning Abramovich, the government accused him of “undermining and threatening the territorial integrity, sovereignty and independence of Ukraine.”
The measures follow persistent political pressure from the Labour Party to punish Abramovich, and warnings from Foreign Secretary Liz Truss that the government would continue to roll out sanctions on UK oligarchs.
Truss also revealed earlier this week the government will bring forward its Economic Crime Bill to next week.
If passed, the bill will make it easier for Downing Street to sanction more people connected with the Russian goverment.
Alongside Abramovich, the government has also accused Evraz of “providing financial services or making available funds, economic resources, goods or technology that could contribute to destabilising Ukraine.”
This includes potentially supplying steel to the Russian military, “which may have been used for the production of Russian tanks.”
Evraz has since released a statement denying it has supported Russia’s invasion of Ukraine in any way, including in the provision of steel to the Russian military.
The company said it only provides long steel to infrastructure and construction sectors.
However, Evraz revealed in a previous statement yesterday it “cannot be certain” whether key shareholders such as Chelsea owner Roman Abramovich, Alexander Frolov, and Alexander Abramov are “connected with Russia”.
Following the latest developments, Evraz will retain its $729m dividend for shareholders, which was due to be paid on 30 March.
Abramovich’s share of the payout would have been worth $210m based on his stake.
Shares in the miner plummeted nearly 70 per cent in the aftermath of Russia’s invasion of Ukraine – with the former blue chip stock set to be booted off the FTSE 100.
Its performance on the stock exchange rebounded over recent days – with investors seemingly attracted to buying the dips amid a historic commodities boom.
Last week, anti-corruption activist and former Hermitage Capital chief executive Bill Browder compared investing in Kremlin-linked assets at ultra-low prices to buying German stocks during the Holocaust.