By John Helmer in Moscow

Russian business is child’s play, and very forgiving too, if you are big enough to pay for your mistakes. That’s why Alexei Mordashov is smiling in the picture, taken in Prime Minister Vladimir Putin’s office on December 4.

Mordashov is the owner of the second most heavily indebted steelmaking group in Russia, after Roman Abramovich’s Evraz group. Both have made multi-billion dollar blunders buying loss-making US steelmills at premium prices, just before last year’s bust reduced the value of the assets, but left enormous loans to be serviced. Both have laid off thousands of Russian steelworkers to “optimise” – Noddy’s word – on the costs of producing steel in Russia, so that the Russian mills will make profitable heaps of money, that can be spent subsidizing the blunders across the Atlantic. Mr Plod knows what’s going on – that’s his job. You might think he cares, too.
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by John Helmer - Thursday, December 17th, 2009
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by John Helmer - Wednesday, December 16th, 2009
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By John Helmer in Moscow

Russia’s state-owned oil pipeline company Transneft has upped the pressure on the controlling shareholders of Novorossiysk Commercial Seaport Company (NCSC) in what one Moscow maritime analyst calls today “an arm-twisting preliminary to next year’s contest over the sale of the 20% state stake in the port.”

While in London the UK High Court enters the third month of the Sovcomflot trial, exposing how Russian maritime officials lie, threaten, plot, and bribe over tanker fleet concessions, the fight over shareholding control of Russia’s second largest oil port illustrates the lack of inhibition with which similar tactics continue to be used for oil concessions onshore, one stage before the oil is loaded for export. Supervising all oil concessions, and with a special interest in the maritime end of the sales chain, according to the London trial testimony, is Deputy Prime Minister Igor Sechin (3rd from left).
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by John Helmer - Tuesday, December 15th, 2009
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By John Helmer in Moscow

To all junior miners, resource project developers, and investors in the risky wilds of Kazakhstan, be of good cheer — a Supreme Court judgement issued on December 11 in Sydney, Australia, has awarded the equivalent of US$11.4 million in compensation, penalties, and costs against a group of lawyers who have been found guilty of engaging in dishonest business practices.

Justice Clifford Einstein had ruled in October that the Kazakhstan-based law firm of Michael Wilson & Partners had been defrauded by three lawyers who had been employed by Wilson; and who had secretly moonlighted to earn fees and share bonuses for stock market listings and other transactions involving several major Kazakh resource projects — Sunkar Resources’s Chilisai phosphate project; Frontier Mining’s Benkala copper project; Roxi Petroleum; Max Petroleum; two other Central Asian mining projects, Urals Gold and Ablai; and four projects tied to these and other operators in the same region — Karamandybas (oil and gas), Ravninnoye (oil), Beibars Munai (oil), Lancaster, and Kangamiut (seafoods).
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by John Helmer - Monday, December 14th, 2009
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By John Helmer in Moscow

Archangel Diamond Corporation (ADC) has re-emerged from a bankruptcy proceeding initiated earlier this year by De Beers, to launch new charges in the Colorado state court against Russian oil company LUKoil, and well-known Russian oligarchs, Vagit Alekperov (lead bearer) and Alisher Usmanov (2nd bearer).

ADC is now being directed by a group of minority stakeholders, led by US attorney Bruce Marks; former board director, Clive Hartz; and the Firebird Global Master Fund of New York, with a stake of about 18%. De Beers owns 56% of ADC’s shares.
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by John Helmer - Monday, December 14th, 2009
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By John Helmer in Moscow

Far Eastern Shipping Company (Fesco), the listed Russian dry-cargo fleet operator controlled by Sergei Generalov (left image), says it has run into a debt refinancing problem with the Russian state bank, Vneshtorgbank (VTB).

A Moscow report by Kommersant newspaper, quoting from a November 5 letter Generalov sent to the Deputy Minister of Economic Development, Oleg Saveleyev, and a report this week from the Moscow brokerage Finam, indicate that, in order to receive state repayment guarantees of up to Rb2.5 billion ($83 million), Generalov must transfer asset value and shares required by the bank. However, Generalov says he can’t right now; or doesn’t want to.
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by John Helmer - Friday, December 11th, 2009
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by John Helmer - Thursday, December 10th, 2009
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Relayed by John Helmer in Moscow

Question for Toby: has the Hong Kong Stock Exchange rejected the share listing application by United Company Rusal?

Toby’s answer: Affirmative grunt.

For at least two months the Hong Kong Stock Exchange and its listing division, and in parallel the state regulator, the Securities and Futures Commission (SFC) have been studying the proposal for listing and sale of shares by United Company Rusal, the first Russian company to attempt to list in the China market. Although the exchange and the commission don’t explain their action in individual cases, it is now plain that they could not agree to approve the listing in several sessions of the 28-member listing committee. The reports of their meetings – on November 19, 26, December 3 and 7 – have been cryptic, with anonymous sources claiming different reasons for deferral and inaction, until now the negative outcome is obvious.
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by John Helmer - Monday, December 7th, 2009
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A D V E R T O R I A L

AND IF YOU LIKE IT ENOUGH, MAYBE I’LL SELL IT TO YOU

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by Editor - Thursday, December 3rd, 2009
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By John Helmer in Moscow

In signals issued just ahead of today’s scheduled meeting of the Hong Kong Exchange Listing Committee, the committee announced a further postponement of its ruling on the Rusal application until December 7. The exchange has issued no public explanation. Media reports claim the reason is that the 28-member committee lacked the minimum required forum of 5 members to sit on the Rusal review. Earlier reports from the exchange had indicated that 8 members had been selected from the 28-member complement for the review. Today’s reports from Hong Kong suggest that 4 of these had dropped out for today’s meeting. The hint is that the applicant and its underwriters are being discreetly invited to take the initiative of withdrawing before next Monday, relieving the exchange of the responsibility of casting a vote on Rusal’s application. This option allows what one underwriter in London suggests as justification — market demand so late in the year is not sufficiently favourable for the share sale.
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by John Helmer - Wednesday, December 2nd, 2009
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