Facebook Twitter



Russia's biggest producer of nickel, copper and platinum went on the auction block Thursday, marking a new high spot in the country's massive state industry sell-off.

Thousands of would-be shareholders stood in line for hours outside a Moscow auction center, one of many such reception points all over the country trading equity in the arctic giant Norilsk Nickel."It's like bedlam here, the demand for shares is so great," Ira Novikova, an employee of the All-Russian Coordinating Center for Check Auctions, said in an interview.

Novikova said 3.78 million shares, representing 12 percent of the company's authorized capital of 31.5 billion rubles ($16.1 million) would be put under the auctioneer's hammer, with sales continuing for two weeks.

Norilsk Nickel accounts for 72 percent of the nickel, 43 percent of the copper, 70 percent of the cobalt and nearly 100 percent of the platinum produced in Russia.

Located near the Norwegian border in Russia's Far North, the enterprise has earned notoriety as one of Europe's major sources of pollution, especially of the acid rain that has devastated forests throughout Scandinavia and contributed to so-called arctic haze.

But it also produces some of Russia's most profitable export items and is a major source of hard currency revenue for the country's depleted treasury, making it attractive to domestic investors.

Novikova said it was the aggressive television advertising campaign spearheaded by Russia's Privatization Chief Anatoly Chubais that prompted the high demand for stock in the metals giant.

"It's unprecedented - people have been ringing up for weeks asking when they could obtain shares," Novikova said.

Chubais last week unveiled government plans to sell off some of Russia's most famous and coveted firms, including the St. Petersburg electrical goods factory Svetlana and the store chain Beriozka, as well as Norilsk Nickel.

Stock in the firms will be swapped for the special privatization vouchers, distributed free to every Russian citizen in 1992 as their share of state property, which are due to expire June 30.

Up to 126 million vouchers of the original 148 million that were handed out have already been redeemed and officials hope the remainder will be scooped up at auctions of giants like Norilsk Nickel before the June 30 dead-line.

According to the privatization plan adopted by the company's 161,520 staff, workers will get 25 percent of shares free and can buy another 10 percent at a 30 percent discount. The management has the right to buy 5 percent of shares while another 10 percent will go to a special reserve fund.

Novikova said another 5 percent of shares will be put up for cash auction after June 30, when the Russian privatization program moves into its second phase and shares will be sold not for vouchers but for money.