OREANDA-NEWS. February 27, 2010. Norilsk Nickel may pay out dividends, according to media sources, citing officials from both Interros and UC Rucal. The latter two companies are key shareholders of Norilsk Nickel, each reportedly possessing more than a 25% stake, reported the press-centre of OTKRITIE Financial Corporation.

The exact amount to be paid out for dividends has yet to be defined, though rumors place the amount in the neighborhood of USD1bn, which may be the figure necesary to satisfy both major shareholders. Reports from Norilsk Nickel have indicated that the dividend payout is not yet a certainty, suggesting that more information would like be available at the end of March.

View: We think that a dividends pay out (even in amount of USD 1bn) is not a problem for Norilsk Nickel since the company is currently benefiting from high prices and high demand for nickel, thus has sufficient cash (USD 2.3bn as of June 2009). In fact, nickel rose 1.2% on Thursday. At the same time, the payout would definitely benefit UC Rusal which is presently running a cash deficit.

Valuation and Action: At the present time, we do not cover Norilsk Nickel stock.