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Rusal to Purchase Norilsk Stake, Proceed With Merger

Oleg Deripaska’s United Co. Rusal agreed to buy 25 percent of OAO GMK Norilsk Nickel, Russia’s biggest mining company, and said it will pursue a takeover.Rusal, the world’s second-largest aluminum producer, will purchase the shares from billionaire Mikhail Prokhorov after his former business partner Vladimir Potanin waived his right to make a bid. “We intend to create Russia’s first global diversified metals and mining company,” Rusal Chief Executive Officer Alexander Bulygin said today in a statement.

A combination of Rusal and Norilsk would create a company that can smelt about 12 percent of the world’s aluminum and produce more nickel and palladium than any other. The company would have a value of $100 billion, Vedomosti said last month, big enough to challenge BHP Billiton Ltd. and Rio Tinto Group.

Potanin didn’t match Prokhorov’s offer of $15.7 billion for the stake, which was “unrealistic,” Andrei Klishas, chief executive officer of Potanin’s Interros Holding Co., told reporters in Moscow today. Prokhorov’s Onexim Group will get 11 percent of Rusal and an unspecified amount of cash for the stake, Rusal said in the statement.

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