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Russian Billionaire Rejects Montenegrin Offer For Aluminum Plant

Oleg Deripaska
Oleg Deripaska
PODGORICA -- Russian businessman Oleg Deripaska has declined a financial aid offer from Montenegro to keep the country's largest industrial plant in operation, RFE/RL's South Slavic and Albanian Languages Service reports.

The Montenegrin government had offered a 20 million euro loan to help the owner of the recently privatized aluminum smelter KAP to maintain production during the global financial crisis.

Montenegro has sought in return a guarantee that Deripaska's Central European Aluminum Company stayed open, that shares be bought in a bauxite mine in the Montenegrin town of Niksic, and shares in Deripaska's main company Rusal as guarantees for the loan.

The conflict between Deripaska and Montenegro originated with the fact that KAP's value was overestimated when Deripaska bought it and he sought 330 million euros ($440 million) in compensation for being misled.

It is likely that the Russian owners will withdraw and KAP will be nationalized.

Some 10,000 jobs are directly or indirectly related to the KAP aluminum smelter.