The former president of Rosbank and Uneximbank on Tuesday was crowned general director of metals giant Norilsk Nickel's core unit, Mining and Metals Co. Norilsk Nickel.
Mikhail Prokhorov, 36, is a longtime associate of Vladimir Potanin, head of the Interros holding, which controls Norilsk, Rosbank, oil producer Sidanko, the newspaper Komsomolskaya Pravda and a number of machine-building enterprises. He has sat on the board of directors of Interros since 1998 and is reportedly a shareholder.
"MMC is now ready to transform the company into a global player," the company said in a press release.
Prokhorov replaced Dzhonson Khagazheyev, who will become Prokhorov's first deputy in charge of domestic operations. Dmitry Zelenin, the former first deputy, was named deputy general director for finance and economics.
Prokhorov's appointment suggests a new focus by the company on maximizing and effectively managing the company's cash flows, said Vladimir Titkov, a metals analyst at Renaissance Capital.
Norilsk, the world's largest producer of nickel and palladium, has been undergoing a complicated and controversial restructuring. By the end of 2001, the controversial swap of Norilsk Nickel shares for MMC shares should be completed. The companies in the Norilsk holding will be consolidated under MMC, which will become the traded company.
Norilsk had profits of more than $2 billion on sales of about $4.7 billion last year under Russian accounting standards, roughly 80 percent from MMC.
Prokhorov has significant international experience, including a tenure as president of Uneximbank from April 1998. The August crash left Uneximbank $2 billion in debt, $800 million to foreign creditors. Prokhorov became president of Rosbank last November after Uneximbank's remaining assets were merged with Rosbank.
"[Prokhorov's appointment] is more positive than negative," said Kakha Kiknavelidze, metals analyst at Troika Dialog. "If Norilsk wants to market this company as a public company to the West, then it needs a Moscow-based CEO who understands Western markets," he added.
"Prokhorov is a shareholder of Interros, whose position has historically been to remain in the background. Now Interros and its shareholders are becoming publicly related to Norilsk Nickel. This could indicate that in the future they'll have less and less to hide about their relationship," said Kiknavelidze.
Not all analysts were optimistic.
"There is a deep skepticism about the aims and objectives of Vladimir Potanin. He is trying to tighten the reins over the company just as metals prices are going down and Norilsk's entire economic environment is darkening because he wants to keep his hands on the money," said one analyst.
Norilsk also announced Tuesday that it signed a deal for a project to develop nickel and cobalt reserves in New Caledonia. The deal with the French island in the South Pacific, which is thought to have a quarter of the world's nickel ore, is the company's first major step in developing a global presence.
Norilsk board chairman Andrei Klishas said at least 20 percent of Norilsk's assets would be located abroad after acquisitions over the next five years, news agencies reported.
Norilsk shares ended up 2.65 percent Tuesday, closing at $17.40.
Mikhail Prokhorov, 36, is a longtime associate of Vladimir Potanin, head of the Interros holding, which controls Norilsk, Rosbank, oil producer Sidanko, the newspaper Komsomolskaya Pravda and a number of machine-building enterprises. He has sat on the board of directors of Interros since 1998 and is reportedly a shareholder.
"MMC is now ready to transform the company into a global player," the company said in a press release.
Prokhorov replaced Dzhonson Khagazheyev, who will become Prokhorov's first deputy in charge of domestic operations. Dmitry Zelenin, the former first deputy, was named deputy general director for finance and economics.
Prokhorov's appointment suggests a new focus by the company on maximizing and effectively managing the company's cash flows, said Vladimir Titkov, a metals analyst at Renaissance Capital.
Norilsk, the world's largest producer of nickel and palladium, has been undergoing a complicated and controversial restructuring. By the end of 2001, the controversial swap of Norilsk Nickel shares for MMC shares should be completed. The companies in the Norilsk holding will be consolidated under MMC, which will become the traded company.
Norilsk had profits of more than $2 billion on sales of about $4.7 billion last year under Russian accounting standards, roughly 80 percent from MMC.
Prokhorov has significant international experience, including a tenure as president of Uneximbank from April 1998. The August crash left Uneximbank $2 billion in debt, $800 million to foreign creditors. Prokhorov became president of Rosbank last November after Uneximbank's remaining assets were merged with Rosbank.
"[Prokhorov's appointment] is more positive than negative," said Kakha Kiknavelidze, metals analyst at Troika Dialog. "If Norilsk wants to market this company as a public company to the West, then it needs a Moscow-based CEO who understands Western markets," he added.
"Prokhorov is a shareholder of Interros, whose position has historically been to remain in the background. Now Interros and its shareholders are becoming publicly related to Norilsk Nickel. This could indicate that in the future they'll have less and less to hide about their relationship," said Kiknavelidze.
Not all analysts were optimistic.
"There is a deep skepticism about the aims and objectives of Vladimir Potanin. He is trying to tighten the reins over the company just as metals prices are going down and Norilsk's entire economic environment is darkening because he wants to keep his hands on the money," said one analyst.
Norilsk also announced Tuesday that it signed a deal for a project to develop nickel and cobalt reserves in New Caledonia. The deal with the French island in the South Pacific, which is thought to have a quarter of the world's nickel ore, is the company's first major step in developing a global presence.
Norilsk board chairman Andrei Klishas said at least 20 percent of Norilsk's assets would be located abroad after acquisitions over the next five years, news agencies reported.
Norilsk shares ended up 2.65 percent Tuesday, closing at $17.40.