Glass Lewis Recommends Voting "for" Early Termination of the Norilsk Nickel Board

By Uc Rusal, PRNE
Wednesday, February 23, 2011

RUSAL Supports Glass Lewis Recommendation That Shareholders Vote for Messrs. Bebchuk and Holden

MOSCOW, February 24, 2011 - UC RUSAL (SEHK: 486, EuroNext: RUSAL/RUAL, MICEX: RUALR, RTS:
RUAL), the world's largest aluminium producer and owner of a 25% stake in MMC
Norilsk Nickel, announced today that Glass, Lewis & Co. ("Glass Lewis"), the
leading independent institutional proxy advisory service, recommended that
shareholders of Norilsk Nickel vote FOR the proposal by RUSAL to approve the
early termination of the powers of the Norilsk Nickel Board of Directors at
the Extraordinary General Meeting of shareholders ("EGM") to be held on 11
March 2011
and vote FOR the election of Messrs. Bebchuk and Holden.

In their report dated 22 February 2011, Glass Lewis supported
RUSAL's request to terminate the powers of the Norilsk Nickel Board of
Directors to elect new Directors. Glass Lewis also echoed RUSAL's view that
Norilsk Nickel must have a new, more balanced board to increase its
effectiveness, including the presence of independent directors; as the report
stated, "In our view, a new board that includes additional qualified
independent directors can provide the necessary oversight of management and
ensure that neither of the two major shareholders can, on its own, control
the decision-making on the board."

With respect to the independent nominees proposed to Norilsk
Nickel's board, Glass Lewis concluded, "[o]f the independent candidates, we
favor Messrs. Bebchuk, Holden and Wilkinson, each of whom is indubitably
independent. In addition, both nominees Holden and Wilkinson have industry
experience that would greatly benefit the board."

To ensure that the minority shareholders' vote is not overly
diluted by voting for three directors, Glass Lewis recommended voting FOR the
election of Bebchuk and Holden to Norilsk Nickel's Board of Directors. Glass
Lewis also reflected RUSAL's support for independent RUSAL nominee Alexander
, concluding, "If Voloshin and two of the aforementioned independent
nominees are elected, the board will consist of at least three independent
directors, which would be a marked improvement over the current composition
of the board." RUSAL fully agrees with this analysis, and encourages
shareholders to support Messrs. Holden and Bebchuk, who, together with
RUSAL's support for Mr. Voloshin, can result in a "marked improvement" for
the Norilsk Nickel board.

Glass Lewis also noted certain concerns regarding transactions
that have taken place at Norilsk Nickel since the Company's prior EGM, held
on 21 October 2010. With respect to the sale by Norilsk Nickel management of
quasi-treasury shares to Trafigura in December 2010, Glass Lewis stated that
"we find reasonable cause for reproach, most notably with respect to the
opacity with which the transaction was executed, as well as management's
failure to involve the full board in the decision making process."

Glass Lewis questioned whether Trafigura would feel compelled
to vote these shares in line with Norilsk Nickel's instructions, pointing out
that "certain of the share purchase agreement's undisclosed terms, including
any potential voting agreements or share lock-ups, could materially alter
Tragifura's behavior as a major shareholder of Norilsk going forward. All
other things equal, such terms might compel Trafigura to behave in much the
same fashion as Corbiere and Raleigh [(Norilsk Nickel's offshore
subsidiaries)]." As RUSAL has previously noted, the absence of any Norilsk
Nickel board oversight of the multi-billion-dollar Trafigura transaction, as
well as Norilsk Nickel's refusal to disclose the transaction terms, raises a
serious concern that Norilsk Nickel management is seeking to control as much
as 15% of the Company's voting power (including the quasi-treasury shares
created by the Company's recent share buyback). This attempt at control is in
violation of every recognized corporate governance norm.

Glass Lewis also criticized Norilsk Nickel's pattern of voting
its own shares (which are held at subsidiary companies). In their report,
Glass Lewis stated that they "firmly believe that treasury shares, or in
this case, quasi-treasury shares (own shares held by subsidiary companies)
should not be voted by management under any circumstances at shareholder
meetings." ISS Proxy Advisory Services ("ISS"), another leading institutional
proxy advisory service, echoed this concern in their report published 18
February 2011
, noting that the voting of quasi-treasury shares "stands in
contrast to the spirit of the law. This is a negative practice from a
corporate governance standpoint, as it allows company management (which
oversaw how the shares were voted) to exert direct control over the board,
thus violating the principle that the board should oversee the activities of
company management."

RUSAL supports the conclusions of Glass Lewis pointed in its
report. We look forward to working with minority investors in Norilsk Nickel
to further develop a balanced board and substantially increase the value of
Norilsk Nickel for all of its shareholders.


UC RUSAL ( is the world's largest producer of
aluminium, in 2009 accounting for approximately 10% and 10% of global
production of aluminium and alumina, respectively. UC RUSAL employs about
76,000 people in 19 countries, across 5 continents. UC RUSAL markets and
sells its products primarily in the European, Japanese, Korean, Chinese,
South East Asian and North American markets. UC RUSAL's ordinary shares are
listed on The Stock Exchange of Hong Kong Limited (Stock code: 486), global
depositary shares representing UC RUSAL's ordinary shares are listed on the
professional compartment of Euronext Paris (RUSAL for Reg S GDSs and RUAL for
Rule 144A GDSs), and Russian depositary receipts that are issued on common
shares of the Company are listed on MICEX (RUALR) and RTS (RUAL) stock


The information contained in this press release is for media advice
only. The contents are true and accurate at the time of publishing,
however, may change over time.

    Vera Kurochkina

Contacts: Vera Kurochkina, +7(495)720-51-70, vera.kurochkina at

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