Uralkali gains as Onexim eyes stake in group

URALKALI gained yesterday for a second day after billionaire Mikhail Prokhorov’s Onexim Group was said to be among potential bidders for billionaire Suleiman Kerimov’s stake in the world’s biggest potash producer.

The stock erased earlier losses, rising as much as 1.6% and trading up 1.1% at 172.83 roubles in Moscow before the market closed.

The number of shares trading was equivalent to about 49% of the threemonth average. The company advanced 0.6% to $26.91 in London.

Mr Prokhorov, who sold his 38% of Polyus Gold International to associates of Mr Kerimov in February, has not made a formal offer, three people with knowledge of the matter said.

Mr Kerimov is seeking a price based on a market value of more than $20bn for the company as a whole, they said.

That would be at least a 28% premium to yesterday’s share price.

“We’re seeing stock volatility in response to reports about the ownership changes,” UralSib Capital analyst Denis Vorchik said in Moscow. “Kerimov’s stake is being offered to different oligarchs.”

Russian entrepreneur Vladimir Kogan is also said to be seeking a stake in the company, according to people familiar with the matter.

Mr Kerimov, who controls 33% in Uralkali with two business partners, began receiving offers from potential buyers after Belarus arrested Uralkali CEO Vladislav Baumgertner on August 26, a month after he pulled out of the Belaruskali trading venture with Belarus that controlled 40% of the global exports of the crop nutrient.

Belaruskali will not renew its co- operation with Uralkali unless the Russian producer changes its strategy or owner, Belaruskali CEO Valery Kirienko said on August 19.

Belarus President Aleksandr Lukashenko said this month that he expected Russia to approach Belarus in an effort to restore co-operation in marketing potash.

Chengdong Investment Corporation, a unit of the sovereign wealth fund China Investment Corporation, on Tuesday acquired a 12.5% stake in Uralkali. It purchased the bonds from Mr Kerimov, Filaret Galchev and Anatoly Skurov.