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Head of Russia's state-owned Rostec joins Norilsk board

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Published: Monday, 11 Mar 2013 | 8:45 AM ET
By: Andrey Kuzmin

MOSCOW, March 11 (Reuters) - The head of Russian state conglomerate Rostec has joined the board of Norilsk Nickel , signalling greater government influence at the world's largest nickel and palladium miner.

The appointment of Sergei Chemezov follows a government-backed deal in December to end a long-running power struggle between Norilsk's main owners - billionaire Vladimir Potanin and aluminium tycoon Oleg Deripaska.

Norilsk shareholders elected a new board of directors and former De Beers chief executive Gareth Penny as chairman at a meeting on Monday, with the aim of balancing the co-owners' power in the company after their recent peace deal.

"Mr Chemezov was elected to the Board by joint decision," Potanin, who is chief executive at Norilsk, told reporters.

The head of Rostec has become one of Russia's most powerful figures under President Vladimir Putin, building an empire that includes the world's biggest titanium maker, Russia's largest carmaker and one of the world's biggest arms exporters.

"Chemezov probably has a mission to represent the government in Norilsk Nickel in some way, but I would not expect him to exert much influence due to the existing tangle of interests in the company," said Sergey Donskoy, metals and mining analyst at Societe Generale.

The agreement between Norilsk's shareholders brought in Roman Abramovich, billionaire owner of Chelsea soccer club, to act as a buffer between Potanin and Deripaska, who owns a share in Norilsk through RUSAL, the world's largest aluminium producer. The deal is expected to be closed by May.

Last month, Chemezov said Rostec and miner Metalloinvest had offered Norilsk a stake in the vast, untapped Udokan copper deposit in Siberia for 3-4 percent in Norilsk. However, Potanin denied negotiations.

On Monday Potanin signalled a deal might be possible in future.

"We did not receive an offer, but it does not mean that we would not be ready to consider such offers and to consider any joint projects, including Udokan, in the future," Potanin told reporters.

Neither Chemezov nor Penny appeared at Monday's meeting.

(Reporting by Andrey Kuzmin; Writing by Polina Devitt; Editing by Jason Bush and Mark Potter)

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The appointment of Sergei Chemezov follows a government-backed deal in December to end a long-running power struggle between Norilsk's main owners- billionaire Vladimir Potanin and aluminium tycoon Oleg Deripaska.

   
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