“Glencore is still evaluating the position under its contracts with Rusal, but notes that these contracts are not financially material to Glencore.”
The Switzerland-based company was slated to swap its Rusal shares for a stake in EN+, but will no longer be carrying out the transaction, the statement said. Analysts believe Rusal may have to default on its debt to international creditors unless it is bailed out by the Russian government.
The billionaire CEO’s move is proof of the immediate effectiveness of the Treasury’s sanctions, aimed at throttling Western investment in the country and cutting the international reach of Russian business magnates who act as conduits for that investment.
Glasenberg’s resignation comes after heavy losses for Russian stocks, which on Monday suffered their worst day since 2014. The U.S. sanctions are intended to strangle access to Western financing for the companies and individuals targeted, and the unpredictable nature of the measures have stoked fears among Russians and foreign investors that no company is safe from future sanctions.
Washington’s latest salvo manifested itself amid the worst Russia-U.S. relations since the Cold War. The countries have expelled scores of each other’s diplomats following the poisoning of a former Russian spy in the U.K., an attack Western officials have attributed to the Russian government. Federal investigations into Russian interference in America’s 2016 election are ongoing, while the Kremlin has denied all accusations against it.
U.K.-listed shares of Glencore were up 2.6 percent shortly after markets opened in Europe on Tuesday.