Rusal analysing losses from inclusion of its subsidiaries into Ukraine¡¯s sanction list

Russian aluminium giant UC Rusal is analysing the losses it would incur if it included its subsidiaries into the Ukraine’s sanction list, reported a media release by the company. The aluminium producer is also strategizing measures to mitigate these losses. 

"Inclusion of Rusal’s subsidiaries and employees into the sanction list is unjustified by nature. Rusal and affiliated companies do not influence on political processes occurring in the territory of Ukraine, do not create threat to national security and do not obstruct economic development of the country," the release stated.

Shareholders will have to bear the brunt of including Rusal’s subsidiaries into the sanction’s list; hence, the company is conducting legal due diligence of such acts so that shareholders’ remain fairly unaffected. In case the sanctions inflict any damage Rusal would demand proper compensation for the same in court, the press service updated. "Inclusion of the company subsidiaries in the sanctions list is detrimental to our shareholders," it added.

Ukraine extended the sanction list of Russian companies including Rusal on Tuesday, accusing the company of actions that threaten Ukrainian national security and assets, according to a presidential decree. According to the decree, Ukrainian authorities will have the right to block Rusal's assets and restrict its trade operations inside the country. The decree did not elaborate on how Rusal's activities threatened Ukraine. Sanctions also include a ban on withdrawing capital, exclusion from bidding for state contracts and a ban on share transactions.

Rusal, the world's second largest aluminium producer, is the owner of Ukraine's biggest alumina plant Mykolayiv and also controls a part of ZALK, Ukraine's only aluminium producer. The company said the sanctions were unwarranted and that it would seek compensation in court.

"RUSAL and its member companies have no influence on the political processes taking place in Ukraine, do not create a threat to national security, and do not hinder the economic development of the country," the company said in a statement.

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