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Evraz PLC on Friday called time on a demerger of coal assets as sanctions imposed on Russia in the wake of the Kremlin's invasion of Ukraine have made the separation ‘technically impossible’.
The Moscow-based steel maker and miner had in March suspended the demerger of PJSC Raspadskaya while it anticipated clarification regarding regulatory restrictions. Sanctions have been imposed on Russian companies and individuals since it invaded Ukraine.
Roman Abramovich, a 29% shareholder in Evraz, has been subject to curbs.
Evraz said on Friday: ‘In light of the unprecedented sanctions against Russia and Russian special economic measures in response to sanctions, which were outside of control of the company, execution of the transaction became technically impossible, and the decision has been taken not to proceed with the demerger.’
It first mulled the demerger back in January of last year. It would have allowed Evraz to focus on developing its steel business, the company explained.
Evraz in March was cut from FTSE Russell indices due to insufficient liquidity, amid the sanctions against Russia. It was a FTSE 100 constituent, but already had been due to be demoted from the index as part of a quarterly review.
Also in March, the Financial Conduct Authority temporarily suspended Evraz's listing, ‘in order to protect investors pending clarification of the impact of UK sanctions’. The stock remains suspended.
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