LONDON – In the second day of London court hearings, billionaire Vladimir Potanin couldn’t pass up the chance to throw a few barbs to his long-running rival Oleg Deripaska.
Potanin took the stand on Tuesday in a case involving a dispute over the sale of shares in MMC Norilsk Nickel, Russia’s biggest mining company. While Potanin and Deripaska have feuded in court before, the public sniping had been quieted since 2012 under a peace deal. Parts of that agreement expired last year, and court testimony this week showed the grudge is still going strong.
“It’s a natural conflict between people who need money now and those who can create long-term value,” said Potanin in a reference to Deripaska and his company, United Co. Rusal. The Russian aluminum giant is heavily indebted and struggling to survive under harsh US sanctions.
Potanin denied allegations made on Monday that he threatened Rusal director Maxim Sokov in meetings. Sokov had described meeting Potanin at his home in February and a game designed to convey a "veiled threat" that would pressure Rusal to waive rights related to Norilsk Nickel shares.
“I’m a chess player, I prefer more predictable games,” Potanin said. “They were just trying to put words in my mouth which I didn’t say.”
“Sokov is trying to read between the lines. He is a good businessman, but maybe when reading between the lines, he is not that good," Potanin added, referring to another meeting between the two.
The central issue in the court case is whether Potanin and Deripaska should be allowed to buy shares of Norilsk Nickel, which were offered for sale earlier this year by Roman Abramovich. Potanin completed the purchase of his part of the shares, but Deripaska argues they should go to a third party under terms of the peacekeeping agreement.
Both Potanin and Deripaska have long jostled for power at Norilsk Nickel, which operates some of Russia’s richest mines in platinum, palladium and nickel. Potanin controls just over 30% of the company, and Deripaska’s Rusal owns just under 30%.
In court, Potanin said he recently bought about 1.5% of the company, also known as Nornickel, on the open market.
In his testimony on Monday, Deripaska called Potanin “evasive” and alleged the billionaire sought to inflate expenditure at Nornickel as a way to cut dividends, which are paid to shareholders including Deripaska.
“We had some unpleasant 10-year-old experiences dealing with them,” Deripaska said in reference to Potanin.
In 2012, their public squabbling over power at Nornickel led to an intervention by President Vladimir Putin. An agreement was struck in which Abramovich bought a small stake in the company in exchange to be a peacemaker between the billionaires.
Deripaska has previously said that if Abramovich sells his stake, it would ruin the balance of power.
Potanin argued on Tuesday that Abramovich should be allowed to sell and disputed his role as a peacemaker. Abramovich doesn’t have voting power to resolve conflicts, so shouldn’t be considered an arbiter, Potanin said.
“I fully understand why he would not wish to become embroiled in a bitter shareholder dispute,” Potanin said in court documents on Tuesday.