The US just sanctioned Russia’s richest tycoon Vladimir Potanin – but not his company Nornickel
The US sanctioned Vladimir Potanin, Russia’s wealthiest tycoon and president and largest shareholder of mining giant MMC Norilsk Nickel PJSC, but left his company untouched as it seeks to maintain stability in the metals market.
The action against Potanin was part of a broader package of sanctions rolled out by the Treasury Ministry on Thursday targeting about 40 people linked to the Russian government. Also included was Rosbank PJSC, which Potanin acquired earlier this year, and its holding company Interros Holding.
“By sanctioning more major Russian banks, we are further deepening Russia’s isolation from global markets,” Treasury Secretary Brian Nelson said in a statement. “Today’s appointments by the United States, combined with actions by our international partners, will further limit the ability of the Putin regime to fund its horrific war against Ukraine.”
More than 40% of Potanin’s net worth — $30.4 billion, according to the Bloomberg Billionaires Index — comes from his stake in Nornickel, one of the world’s largest producers of nickel, palladium, and copper. Although the restrictions have not been extended to nornickel, which was not mentioned at all in the release, they could still prompt some customers and banks to avoid Russian metal in a form of self-sanction.
Nickel prices in London were little changed, while palladium was trading more than 5% lower in the spot market.
The US action comes after the UK imposed sanctions on Potanin in late June. Previously, Potanin had largely avoided Western sanctions hitting other members of the Russian elite. He was also sanctioned by Canada and Australia.
Potanin has led Nornickel since reaching a shareholder agreement with United Co. Rusal International PJSC, the company’s second-largest investor, in 2012. Potanin’s nearly 36% stake is held through his investment firm, Interros Holding.
Both Nornickel’s press service and Potanin’s spokeswoman declined to comment.
According to a statement by the US State Department, the sanctions also apply to Potanin’s wife and two adult children. They also cover the hundreds of millions of dollars worth of superyacht Nirvana, it said.
Russia is one of the largest nickel producers in the world, accounting for about 9% of world production.
The London Metal Exchange last month decided against a ban on new supplies of Russian metal after opening a formal discussion on the matter in October in response to self-sanctions by some consumers. Although the US and Europe have imposed sweeping sanctions on Russia in response to Ukraine’s invasion, metals traded on the LME have largely avoided blanket restrictions.
Since Russia’s invasion of Ukraine, Potanin has bought out some of Russia’s most important private banks, including buying Rosbank from Societe Generale SA. He also bought a stake in Tinkoff Bank from founder Oleg Tinkov, who said he was forced to sell after criticizing the war.
Our new weekly Impact Report newsletter explores how ESG news and trends are shaping the roles and responsibilities of today’s leaders. Subscribe here.
