Uneximbank, the Russian bank, won the shares at a controversial auction on Tuesday by offering to pay the equivalent of $617m (pounds 400m) for the 38 per cent stake - well below the market value.
Now it has the difficult task of overhauling the behemoth enterprise, which supports about 300,000 people from its base above the Arctic Circle. Analysts expect Uneximbank to succeed. "We'll see Uneximbank try to consolidate its majority share, then it's to the moon for the stock," said James Fenkner, head of research at Moscow brokerage CentreInvest Securities, which has recommended Norilsk shares.
Norilsk shareholders will get the chance to vote next month on a proposal to sell more shares to themselves, part of a plan to raise more capital. The shares closed the week at $15.46, up from $15.00.
The company's fate is of interest to more than just the bankers sitting in Uneximbank's offices on Masha Poryvaevaya Street in central Moscow. In the metals market, traders are constantly looking north because Norilsk is the world's largest producer of palladium and the second-largest producer of nickel. "It's a vital element in large and major areas of the non-ferrous metals market," said Christopher Granville, head of research at UCB, the Russian unit of MC Securities. "It's evident that when some news that has an impact on production at Norilsk comes on the wires, you have an immediate reaction in the London metals market."
Norilsk is a giant company town, which has traditionally provided everything from salaries to kindergartens and pensions for its people in Siberia's Krasnoyarsk region. If Norilsk can adapt to the realities of a market economy, other such giant Russian enterprises may also succeed.
"It's a clear symbol of transition from the old Russia to the new Russia," said Philip Manduca at London-based Eldon Capital Management.
"It has huge social bills, huge infrastructure, huge costs," he said. "It's a flagbearer of restructuring. If it goes as it should, so goes Russia."
Uneximbank is no stranger to Norilsk. It became custodian for the shares it purchased last week by lending the government $170m under the loans- for-shares programme in November 1995, when big Russian banks lent the government money and received shares as collateral. If the government failed to repay, the banks were supposed to sell the shares to recover their money.