Rusal to quit global market if United States sanctions stay after new board

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The updated blacklist included major Russian aluminum producer RUSAL which is the world's second-largest aluminum producer and its owner Oleg Deripaska.

Russian billionaire Oleg Deripaska is poised to sell down his stake in EN+ as the aluminium and power company seeks to escape crippling USA sanctions. "RUSAL has activated a contingency plan asking customers to pay in euros instead of dollars to try to skirt U.S. sanctions", one of the sources said.

"Oleg Deripaska agreed in principle with the chairman's request that Mr. Deripaska reduce his shareholding in the company to below 50%", En+ said.

It was not immediately clear whether Deripaska's agreement to step down from En+'sboard of directors and reduce his stock holdings to below 50 percent would satisfy the Treasury's demands for removing Rusal from the sanctions list.

Treasury "conducts a thorough review of the facts and circumstances of each removal request in every individual case", the spokesperson said.

Russia's Rusal will be forced to quit the global aluminium market and focus on domestic consumers if the USA does not lift sanctions once an independent board is in place, a source familiar with the matter said.

"Rusal is in touch with USA authorities and hopes the measure will be enough for them to be removed from the sanctions list", one of the two sources said.

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EN+ said Friday that its ability to maintain its listing on the London Stock Exchange was threatened by the sanctions announced by the US Office of Foreign Assets Control, and had appealed to OFAC to extend the current deadline of May 7 for US persons to "divest or transfer debt, equity, or other holdings in the company to a non-US person, or to facilitate the transfer of debt, equity or other holdings in the company".

Rusal, the largest part of Deripaska's empire and the world's biggest aluminium producer outside China, has seen customers stop buying its aluminium and while the company's creditors have scrambled to offload its extensive debts.

"It means that Rusal will turn into. a company, which will only look after the domestic market's ambitions".

It said in a release that "The LME is now undertaking further analysis in relation to the application of in relation to Rusal brand metal, and may issue a further communication in due course".

The Treasury Department has imposed sanctions on seven Russian oligarchs and 12 firms they own or control, including Hong Kong-listed Rusal, saying they were profiting from a Russian state engaged in "malign activities" around the world.

"Forty eight percent is not a controlling stake of 50 percent, which under the US rules triggers the sanctions", the source said.