Russian govt rep to join Norilsk board

A government representative will join Norilsk Nickel’s board of directors after state bank VEB agreed to refinance a $4.5 billion loan to UC RUSAL.

MOSCOW (Reuters)  - 

A Russian government representative will join the enlarged board of miner Norilsk Nickel after state bank VEB agreed to refinance a $4.5 billion loan to one-quarter shareholder United Company RUSAL.

UC RUSAL, which incurred the original debt to help finance its acquisition of the stake in Norilsk, said in a statement two government representatives would also join the management team at Norilsk, the world's largest nickel miner.

The appointment of the government representatives would "weaken" the influence of Vladimir Potanin, Norilsk's chairman and largest single shareholder, UC RUSAL said in the statement.

UC RUSAL also said the loan from VEB, or Vnesheconombank, would have an interest rate of LIBOR plus 5 percent and had been provided for one year, with an option to extend at at the discretion of the bank's advisory council. (Reporting by Robin Paxton)

© Thomson Reuters 2008 All rights reserved

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