Russian stocks facing the boot from FTSE 100: Evraz and Polymetal to crash out as shares dive
Two Russian firms will be booted off the FTSE 100 after the invasion of Ukraine sparked a collapse in their share price.
As questions mount over the presence of Russian stocks on the London market, steelmaker Evraz and gold miner Polymetal International are expected to drop out of the blue chip index in today’s quarterly reshuffle.
Evraz shares have fallen 83 per cent this year, costing biggest shareholder Roman Abramovich more than £2.1billion. Polymetal is down 78per cent.
Out: Russian-owned steelmaker Evraz and gold miner Polymetal International are expected to drop out of the blue chip index in today’s quarterly reshuffle
The rout continued yesterday as the FTSE 100 index fell 1.7 per cent while the main benchmark in Frankfurt was down 3.9 per cent, Paris dropped 3.9 per cent and Milan sank 4 per cent.
Oil hit a fresh seven-and-a-half year high of $107.57 a barrel, gas prices rose more than 50 per cent and the rouble crashed 8 per cent to a fresh all-time low.
It comes amid calls for Russian companies listed in London with close ties to the Kremlin to be removed from the stock market altogether.
‘Every Western measure taken to date has been to put financial and economic pressure on Moscow to change its course,’ said Sam Ashworth-Hayes, director of studies at the Henry Jackson Society, a foreign policy think-tank.
Former Conservative Party leader Iain Duncan Smith MP said companies should be ‘delisted immediately’ if any suspicions were raised about possible links to Putin, his associates, or their sources of income. ‘It is important that all these entities are investigated properly’, he said.
The stock market in Moscow remained closed for a second day. But Russian firms with secondary listings overseas were hammered once again.
In London, Russia’s biggest bank Sberbank plunged more than 80 per cent while gas giant Gazprom was down over 70 per cent.
‘With the corporate world increasingly freezing out Russia’s financial sector, investors are fleeing,’ said Hargreaves Lansdown analyst Susannah Streeter.
The invasion of Ukraine has thrust London-listed Russian companies, as well as their owners and bosses, into the spotlight.
Chelsea FC owner Abramovich owns a near-29 per cent stake in Evraz while founder and chairman Alexander Abramov is the second-largest shareholder with 19 per cent.
Both are on the US Treasury list of oligarchs deemed close to Vladimir Putin.
Polymetal founder Alexander Nesis, its biggest shareholder with a stake of almost 24 per cent, is also on the list. Polymetal is run by his brother, chief executive Vitaly Nesis.
‘The fortunes of Evraz and Polymetal have reversed dramatically,’ said Streeter.
Firms expected to replace Evraz and Polymetal in the FTSE 100 are Africa-focused miner Endeavour and kitchen as well as bathroom fitter Howden Joinery.
Tycoon with Gazprom links eyes UK lottery
Karel Komarek (pictured with wife Stepanka) owns Sazka, which has become one of Europe’s biggest lottery operators
Fears are mounting that a Czech billionaire with links to the Russian oil and gas industry could get his hands on the National Lottery.
Karel Komarek owns Sazka, which has become one of Europe’s biggest lottery operators.
A decision by the Gambling Commission on who will win the licence for the National Lottery is expected as early as next week and Sazka is in the running, alongside current incumbent Camelot.
The lottery generates billions in sales and is one of the most lucrative Government franchises on offer to private firms.
Sazka boosted its bid when it hired Lord Sebastian Coe, the president of World Athletics, as a non-executive director last year. Other hires include Justin King, the former Sainsbury’s chief executive, and Sir Keith Mills, creator of Nectar points.
The favourite, Camelot, has Sir Hugh Robertson as its chairman. He was minister for sport when the Olympics took place in 2012.
Camelot has had the licence since 1994 but has come under fire from MPs who have accused it of increasing its profits at the expense of the money given to good causes.
Komarek has come under increased scrutiny for his activities. He has a £4.1billion fortune.
He owns and is chairman of MND, a Czech oil and gas exporter. Under him, MND invested in Vemex, a natural gas trader and retailer controlled by Russia. Gazprom, the Russian-owned energy corporation, owns 50 per cent of Vemex. MND holds 17 per cent.
The National Lottery licence is being contested by four bidders.
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