Russian aluminium giant Rusal faces market meltdown after USA sanctions

Russian aluminium giant Rusal faces market meltdown after USA sanctions

The company floated its shares in London in November, raising $1bn (£710m), despite concerns that it could face sanctions related to Deripaska's ties to Putin.

The overall wealth of 50 richest Russians decreased by around $12 billion after the stock market decline due to the sanctions imposed by the United States of America, as Russian Forbes reported.

The Kremlin slammed the sanctions.

The measures affect the seven oligarchs, 12 companies they own or control, as well as 17 senior Russian government officials.

The action targeted Russian oligarchs whose companies have wide-ranging involvement in global capital markets.

Rusal, which produces about 7% of the world's aluminium, said it regretted its inclusion on the new U.S. sanctions list.

"Rusal will probably have to be bailed out by Russian state banks", wrote analysts at TS Lombard.

Iran warns Trump he would regret dropping nuclear deal
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"The company's initial assessment is that it is highly likely that the impact may be materially adverse to the business and prospects of the group", the company said. The Russian ruble has also sold off against the US Dollar and is down 3.5% so far.

In a sea of red for Russian stocks Evraz, the FTSE 100 mining group part-owned by Roman Abramovich, fell 14 per cent and Polymetal, the FTSE 250 miner, closed down 18 per cent. On Friday, Deripaska described the United States sanctions as "groundless, ridiculous and absurd".

The sanctions also hit Norilsk Nickel, whose shares were down 16 percent.

EN+, which only listed in London in November having raised $1 billion from City investors despite fears over the potential of further sanctions being imposed on Russian Federation, said it would focus on maintaining its operations and ensuring it "abides by all applicable laws and regulations".

The US Treasury has said investors have until 7 May to divest or transfer debt, equity or other holdings in Rusal, En+ and Russian carmaker Gaz.

The US said it imposed the latest sanctions because of Russian activity in Ukraine, its support of President Bashar al-Assad in Syria's civil war and for subverting Western democracies.

On Friday Russia's foreign ministry said there would be a "tough response" to the sanctions.

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