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April 25, 2008 2:12 PM

Eastern Promises

Posted by Brian Baxter

The richest Russian oligarch can certainly afford some top-notch legal talent. Four firms helped aluminum giant RUSAL acquire a $4.5 billion stake in MMC Norilsk Nickel, the world's largest nickel and palladium producer.

U.K. firm Ashurst and Russian firm Egorov Puginsky Afanasiev & Partners were the lead legal advisers on the deal for RUSAL, owned by Russian billionaire tycoon Oleg Deripaska. Both firms have longstanding relationships with the Moscow-based aluminum giant.

New to the party was Wachtell, Lipton, Rosen & Katz, which represented RUSAL for the first time in this deal. Lead Wachtell lawyer Andrew Nussbaum, a corporate partner in New York, says the firm was brought in to provide strategic M&A advice.

Deripaska's RUSAL will purchase the 25 percent-plus-one-share stake in Norilsk from ONEXIM Group, a holding company for fellow oligarch Mikhail Prokhorov that was advised by a team of lawyers from Hogan & Hartson.

Nussbaum says the "plus one share" phraseology is important because it constitutes a blocking position under Russian law. (Nussbaum says another oligarch, Vladimir Potanin, owns a similar stake of undetermined size in Norilsk.)

In addition to a cash component, ONEXIM receives a 14 percent stake in RUSAL, as well as representation on the Moscow-based company's board of directors.

The London-based Ashurst team was led by Charlie Geffen and included corporate partners David Kershaw, Gavin Gordon, and Andrew Edge. Neil Cuninghame advised on antitrust issues.

The lead lawyer on the deal for Egorov Puginsky was its chairman, Dimitry Afanasiev. Corporate partner Arkady Krasnikhin, M&A partner Maria Miroshnikova, and litigation partner Grigory Chernyshov, rounded out the team for one of Russia's largest firms.

Cleary Gottlieb Steen & Hamilton capital markets partner Glen Scarcliffe advised RUSAL on the financing. The firm is slated to advise the company on an IPO expected to take place sometime in the future in either London or Hong Kong.

--Additional reporting by Richard Lloyd in London

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