Deripaska resigns from Rusal board over US sanctions

Oleg Deripaska has close links to Russian President Vladimir Putin

Russian aluminium giant Rusal said Friday that Oleg Deripaska has resigned his seat on the board, a key step in the company's efforts to escape US sanctions targeting its founder and key shareholder.

"Mr Oleg Deripaska, non-executive director of the company, has tendered his resignation as a director of the company with effect from 25 May 2018," Rusal said.

In a statement it said the resignation was in line with "the efforts that have been made by the management of the group to protect the interests of the company and its shareholders since the OFAC sanctions were imposed."

The US Treasury's Office of Foreign Assets Control (OFAC) announced fresh sanctions against Russia last month following the diplomatic crisis sparked by the poisoning on Britain of former double agent Sergei Skripal.

The sanctions hit oligarchs close to President Vladimir Putin, including Deripaska.

The announcement prompted the shares of the firm responsible for seven percent of the world's aluminium production to tumble while the price of the metal soared.

Manufacturers feared they would no longer be able to purchase supplies from the firm, potentially snarling production in many sectors of the US economy and elsewhere.

Faced with the market turmoil, the US government then indicated Rusal could avoid being caught up in the sanctions by cutting ties with Deripaska, one of the so-called Specially Designated Nationals targeted by the sanctions.

On Thursday, Rusal announced that its chief executive and half of its board of directors had resigned.

Deripaska, who is the major shareholder in Rusal via a holding company, had already indicated he would not seek reappointment to the board and would reduce his stake.