A long-simmering conflict between two of Russia's wiliest oligarchs came to a head yesterday when Viktor Vekselberg walked away from his role as chairman of Rusal, the world's largest aluminium company.
He said the company, controlled by Oleg Deripaska, is in crisis. Mr Vekselberg's departure is the latest development in a complex chain of oligarchic rivalries and personality clashes in the Russian metals sector that show no sign of abating.
"I regret to say at this time that Rusal is in a deep crisis, caused by the actions of the management," said Mr Vekselberg in a statement in the early hours of yesterday morning.
The billionaire, who is said by Forbes magazine to be Russia's eighth-richest man with a fortune of $12.4bn (£7.88bn), owns a 15.8 per cent stake in Rusal along with his investment partners.
Rusal responded yesterday that Mr Vekselberg was simply jumping before he was pushed, after the board had got irritated by the oligarch's non-attendance at meetings over the past year.
"In this respect, the decision of Mr Vekselberg to resign as chairman of the board pre-empted the anticipated consideration of this matter by the board," said Rusal.
One of the main bones of contention between the two men has been Rusal's quarter-share of Norilsk Nickel, another metals giant.
Mr Deripaska bought a 25 per cent stake in the company through Rusal four years ago, as part of a long-term strategy to create a mega metals company by merging the two. Then the financial crisis hit, making the loan-financed purchase appear foolhardy, and Mr Deripaska was only bailed out by huge state loans.
Since then, Mr Deripaska has refused to consider selling Rusal's stake in Norilsk back to the company, despite an offer from Norilsk and calls from Mr Vekselberg to do so.
Rusal has not paid out dividends as it seeks to reduce its £7.2bn debt, and its shares have lost 43 per cent of their value since its initial public offering in Hong Kong in January 2010.
Selling the Norilsk stake would flood the company with cash, something that Mr Vekselberg has been keen to see happen.
"Deripaska is a strategic investor whereas Vekselberg is a financial investor," said Robert Mantse, metals and mining analyst at Otkritie, a Moscow-based brokerage. "There has been a number of disagreements between them, but the two main ones are over the stake in Norilsk and the dividend policy. As a financial investor, Vekselberg is looking to monetise his ownership."
Ultimately, many of the disputes come down to personality clashes among men who often have egos to match their wallets.
Aside from Mr Deripaska's dispute with Mr Vekselberg, he also does not see eye to eye with Vladimir Potanin, whose Interros company controls Norilsk Nickel. In turn, Mr Potanin had a long and acrimonious falling out with his long-standing partner in Norilsk, Mikhail Prokhorov, with the two men now operating separately, and Mr Prokhorov picking up a 17 per cent stake in Rusal.
Mr Prokhorov, who has a playboy reputation and also owns a US basketball team, stood for the Russian presidency against Vladimir Putin in elections earlier this month, winning around 8 per cent of the vote. Many speculated that his candidacy was aimed at sponging support away from the street protests that have grown up in Moscow recently and diverting them towards a "reliable" opposition candidate.
After the election, Mr Putin said he may well consider giving Mr Prokhorov a role in government.
Mr Vekselberg has also been busy with a government-assigned role in recent years, after being appointed by President Dmitry Medvedev to head the Skolkovo project, which is meant to emulate California's Silicon Valley in Russia, and wean the country off dependence on exporting natural resources.
But while the lives of Russia's richest men are often influenced by behind-the-scenes squabbles or orders from the Kremlin, analysts said this latest dispute was unlikely to involve the hand of the Russian government.
"I don't see any government involvement here at all. This is a dispute between two core shareholders," said Mr Mantse.
Despite emerging a winner from the ruthless "aluminium wars" of the 1990s and at one stage the richest man in Russia, Mr Deripaska has had a rough ride of things in recent years, especially in the aftermath of the financial crisis.
In 2009, he was on the receiving end of a public dressing down from prime minister Mr Putin, as he was summoned to a meeting in the town of Pikalyovo and forced to sign a contract to ensure that an idling factory in the town renewed operations. Mr Putin likened the oligarchs to "cockroaches" and threw a pen down for the meek Mr Deripaska to sign the paper.
Analysts have also forecast possible tough times for metals and mining companies when Mr Putin returns to the Kremlin in May. The Russian leader's election programme featured a number of generous social spending promises that may be difficult to fund without increasing taxes. With plans to cut levies in part of the oil sector, this leaves metals as a vulnerable area.
Yesterday's news may not have too much effect on Rusal in the short term, as the differences between the two men have long been public knowledge. Shares fell 1.3 per cent yesterday before trading was suspended.
In the longer term, however, Mr Deripaska still has a number of challenges to face, including a battle in the London courts with Israel-based businessman Mikhail Cherney.
Mr Cherney claims that he was a shareholder in Rusal, and is demanding the equivalent of one-fifth of the company in compensation.Reuse content