THE world's largest aluminium producer, Rusal, was this weekend putting the finishing touches to $4.5 billion (£2.3 billion) fundraising that should allow it to buy a 20% stake in Norilsk Nickel.
The move will be a significant step towards the creation of a Russian metals and mining group on the scale of industry majors such as BHP Billiton and Vale. Norilsk is the world's largest producer of nickel.
But Rusal's move on Norilsk is not without controversy, and may face opposition from the Norilsk board. Russian reports say the directors are expected tomorrow to try to thwart Rusal by approving a $5 billion share buyback, which would be financed by the sale of the company's power-generation assets.
The tug-of-war is seen as part of a continuing "divorce" between two oligarchs, Mikhail Prokhorov and Vladimir Potanin, long-time business associates who together built up Norilsk into a leading metals group.
Prokhorov sprang to unwanted prominence in the West last year when he was detained by French police in the ski resort of Courchevel on suspicion of supplying prostitutes for his guests.
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The billionaire, who has always denied any wrongdoing, was held for four days and released without charge.
The pair have been negotiating over a split of their sizeable business empire for more than a year. They are thought to share assets of £20 billion covering 200 firms and 150,000 employees.
Recent negotiations for Potanin to buy Prokhorov's stake in Norilsk came to nothing. Now Rusal is expected to take a 20% stake - with the deal likely to happen next week - in return for $4.5 billion in cash and an 11% stake in the enlarged group. The company received the necessary regulatory clearances for the deal last week.
But Potanin and the Norilsk board are expected to attempt to stop Rusal by using the share buyback to vote down any proposals it may make.
The lead banks on the Rusal fundraising are ABN Amro, BNP Paribas, Credit Suisse and Merrill Lynch, with Morgan Stanley acting as lead arranger.