By Shanima A
(Reuters) – Russian steelmaker Evraz, whose biggest shareholder is sanctioned billionaire Roman Abramovich, on Friday scrapped plans to separate its coal assets, citing sanctions on Moscow following its invasion of Ukraine.
The London-listed company said the sanctions made it “technically impossible” to execute the demerger it proposed early last year to concentrate on its core steel business.
The move comes after Evraz indefinitely suspended the demerger of the Russia-based assets, consolidated under Raspadskaya (RASP), last month as it sought more clarity on sanctions against Abramovich.
Evraz has said Abramovich, who has a 28.64% stake in the company and owns English soccer club Chelsea, does not have effective control of Evraz, adding it believes the company is neither designated nor sanctioned.
Evraz, whose shares had lost more than 60% in value since the sanctions began when they were suspended from trading on March 10, has been thrown into turmoil by the sanctions – with only its CEO remaining on the board after a director exodus, and last month a bond payment was blocked.
The West has imposed broad economic and political sanctions on Russia, Russian firms, and prominent or wealthy Russians since Moscow launched what it calls “a special military operation,” in Ukraine on Feb. 24.
Britain imposed sanctions on Abramovich on March 10, freezing his assets and preventing him from travelling to the country.
Evraz said on Friday RASP would remain part of the company.
In March, index provider FTSE Russell said it would remove four Russia-focussed companies, including Evraz, from all FTSE’s indexes, after many brokers refused to trade their shares.
(Reporting by Shanima A in Bengaluru; Editing by Shinjini Ganguli and Mark Potter)
