August 17, 2018 / 6:33 AM / in a month

Rusal says board backs change of domicile to Russia

MOSCOW (Reuters) - Russia’s sanctions-hit aluminum giant Rusal (0486.HK) said on Friday its board had discussed and approved a change of domicile from Britain’s Jersey to Russia in order to take advantage of new special tax regulations.

The logo of Russian aluminium producer Rusal is seen on a board at the St. Petersburg International Economic Forum 2017 (SPIEF 2017) in St. Petersburg, Russia, June 1, 2017. REUTERS/Sergei Karpukhin

Rusal, which was hit with U.S. sanctions in April that seriously disrupted aluminum supplies, said the relocation was still subject to shareholder approval.

The announcement comes a day after En+ Group (ENPLq.L), which is also subject to U.S. sanctions on the two companies’ tycoon co-owner Oleg Deripaska, said it was considering re-domiciling to one of Russia’s new offshore zones.

Russia has created two special administrative regions where companies enjoy benefits such as a zero tax on profits received by way of dividends - an arrangement similar to foreign offshore tax havens.

Rusal said its board had decided that a change of domicile might be “in the best interests of the company and its shareholders as a whole” and entrusted the management with developing a detailed action plan.

Shares in Hong Kong-listed Rusal, the world’s largest aluminum producer outside China, are down 54 percent since the sanctions were imposed on April 6.

Reporting by Maria Kiselyova; Editing by Tom Balmforth; editing by David Evans

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