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14

Norilsk Nickel Offers Buyout Minority Shareholders

Russian metals giant Norilsk Nickel offered yesterday to buy out minority shareholders

Russian metals giant Norilsk Nickel offered yesterday to buy out minority shareholders who did not support its plan to spin off gold unit Polyus at a substantial discount to its market share price.

Shareholders voted overwhelmingly on September 30 in favour of spinning off Polyus into a separate company. Holders of 5% of Norilsk's shares who did not vote, or voted against the spin-off, will be offered cash for their shares.

The price of the offer was set at 1 855 roubles per share -- over 20% below the current market price of Norilsk shares of $82,05.

Norilsk said in a statement it would offer to buy back 10.8 million shares between November 24 and December 14, although the company does not expect the offer to meet much interest.

The new company, Polyus Gold, to be created in March 2006 and listed in Russia and abroad, will include Norilsk's Polyus gold subsidiary and its 20 percent stake in South Africa's Gold Fields, the world's fourth largest gold producer.

On February 17 shareholders will vote on reducing Norilsk's charter capital to cancel the redeemed shares, along with 5,8% of Norilsk that the company bought back for $750 million earlier this year.