Without agreeing to lift sanctions with the US Treasury, billionaire Oleg Deripaska leads his aluminum empire to collapse.
"Rusal" will be forced to stop production in factories, unless sanctions are lifted in the near future, TASS sources in the industry said.
On August 6, the company, the world's largest aluminum producer outside of China, began to conserve the electrolysis capacities of the Nadvoitsky aluminum plant, a city-forming enterprise located in the village of the Republic of Karelia with a population of just over 7,000.
The plant worked exclusively on the American market, and after sanctions lost both sales and stable supplies of raw materials.
The fate of NAZ in the near future can be divided several more factories "Rusal", which produce products for other foreign markets, said a source close to the company.
According to him, the situation in the industry is "much worse than analysts see."
"If the sanctions are not lifted in the near future, the contracts will end, and from October 1 all products destined for foreign consumers will again go to the warehouse, despite the fact that there is still some unrealized aluminum in April," explains the source .
According to another employee of "Rusal", "the production of alloys and products with added value for foreign consumers can be stopped as early as September."
Taking into account that 80% of Rusal's products were exported, the situation could become "catastrophic for both enterprises and the entire global aluminum market," a third TASS source said.
Deripaska hoped to lift the sanctions from August. But the package of proposals sent to the US Treasury was met with a refusal, and the negotiations reached a deadlock.
According to Bloomberg, the billionaire was ready to reduce to a level of less than 50% the stake in the En + holding company, through which he controls his key assets, and to transfer the majority of seats on the board to independent members.
The counterclaims put forward by Washington, he considered unacceptable, bonded and without economic sense.
As a result of the second quarter, Rusal's sales fell by 18% (year-on-year), and revenue decreased by 22% compared to January-March.
The cash reserves in the accounts, amounting to $ 814 million at the beginning of the year, decreased to $ 625 million, while the net debt, which was not covered by financial reserves, reached $ 7.875 billion.
If negotiations with the US authorities fail, Deripaska is considering selling his shares of Rusal to Chinese investors. Another option is the nationalization of the company or its transition to the control of one of the Russian state-owned banks, Bloomberg reported referring to materials from Mercury LLC, representing the interests of a businessman in negotiations with the US authorities.