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Message: what russian papers say...polyus

what russian papers say...polyus

posted on Sep 29, 2008 08:53AM

President Medvedev adopts Vladimir Putin's rhetoric and flair

Dmitry Medvedev sounds more and more comfortable in his role as the Russian president, gradually adopting his predecessor's language and tone.
Last Wednesday, he slammed Polyus Zoloto, Russia's largest gold miner, although his attack was not as destructive as those by Putin used to be.
"Stop whining! If gold mining profits are too marginal for you, give up this work; we'll find someone else. If you want, we can take the license back," he told Polyus general director, Yevgeny Ivanov, at a meeting in Magadan in response to a small complaint about the government's lack of haste in providing assistance in developing the Natalkinskoye deposit.
Similar rhetoric used by Vladimir Putin against the Mechel steel giant caused panic on the stock market in July. "Mechel was selling steel in Russia at twice the price it put on exports," Putin said in televised comments. "And where has the margin for the state taxes gone?"
His promise to send a doctor to Mechel's owner, who was reportedly ill and not present at the meeting to hear Putin's threat, cost the company $5 billion - it was exactly this amount by which Mechel's market capitalization collapsed that evening on the New York Exchange. Investors then rushed to dump Russian stocks, causing the whole Russian market to lose $144 billion in a week.
Admittedly, Medvedev's statement did not have such an overwhelming effect. The market seemed more alert to economic realities than to presidential comments. Polyus shares went up last Wednesday long with other stocks. Friday saw a general 20% surge, while most blue chips fell with Sberbank in the lead.
Gold has not budged from the current $900 per ounce. It is usually regarded as safe haven for investors when storms rage on the financial market.
On the day Medvedev criticized Polyus Gold, it became known that its owners, Mikhail Prokhorov and Vladimir Potanin, had finally settled their dragged-out conflict two weeks earlier by signing a protocol on the delineation of assets. Prokhorov obtained his former partner's stake, which added formal control of the company to his actual control.
Polyus's stocks are clearly of interest to the market. Despite the settlement between its co-owners, Suleiman Kerimov's Nafta Moskva immediately made an offer to Potanin to buy his stake. That caused the company's shares to surge 46% on the RTS last week.

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