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Russia's central bank calls out violations in state asset grab
Russia's central bank calls out violations in state asset grab
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By Elena Fabrichnaya, Anastasia Lyrchikova and Gleb Bryanski Russia's central bank has ruled the state violated the rights of minority shareholders in some asset seizures it made in relation to its conflict in Ukraine, sources told Reuters, in a first pushback by the Russian elite on the nationalisation process.Amid the confrontation with the West over the , tens of billions of dollars worth of assets owned by foreign investors and Russian billionaires have changed hands, mostly after being seized by the state.But within parts of the Russian elite, there are signs of a backlash, especially among market-friendly technocrats who are credited with saving the Russian economy from collapse amid the toughest sanctions ever imposed on a major economy.Some business executives and central bank and finance ministry officials are questioning what they see as a move to a Soviet-style command structure, with all resources mobilised towards achieving military victory in Ukraine, the sources said.Three sources close to the central bank and the Moscow Stock Exchange told Reuters that MOEX had officially complained to the central bank over the alleged violation of the law by the government after seizing a majority stake in gold miner UGC.SEIZING PRIVATE PROPERTY Although the complaint did not question the seizure itself, the central bank ruled that the state had failed to make an obligatory buyout offer to shareholders in a public company and asked the state property agency to execute the offer. "The state's actions in the UGC case are undermining the last semblance of private property rights in Russia," one source with knowledge of discussions, who spoke on condition of anonymity due to the sensitivity of the situation, told Reuters.The Moscow Stock Exchange and the finance ministry declined to comment on the issue. The source said that the state de-facto devalued the stakes of private investors who purchased shares on the open market and have no connection to the court case against the company, nor links to the previous billionaire owner Konstantin Strukov. "I take it that when a nationalisation of property is taking place the law does not work," Oleg Kuzmichev, a private investor in UGC shares, told Reuters. 'WHO WILL BUY SHARES AFTER THIS?'UGC held one of the biggest initial public offerings in Russia in 2023, positioning itself as a safe-haven bet on gold in turbulen...