The future of Roman Abramovich’s steel business Evraz was thrown further into doubt today after a mass board walkout.
Ten non-executive directors quit the London-listed company this morning in response to UK government sanctions on Abramovich, who owns just under a third of Evraz.
The mass resignation leaves just CEO Alexey Ivanov on the board and follows the suspension of shares on the London Stock Exchange on Thursday. Regulators said the stock would remain frozen until they could work out what sanctions mean for the business.
Evraz argued penalties should not apply because Abramovich does not own a majority of shares and the board is substantially independent. Today’s resignations throw that assertion into doubt. The Russian steel giant said it was “waiting for further clarifications” from the government.
Among those to quit is Sir Michael Peat, the former treasurer to the Queen and Principal Private Secretary to Prince Charles and the Duchess of Cornwall. He has served on the Evraz board since 2011 and was due to step down this month.
Others leaving include serial City of London non-exec Deborah Gudgeon and Romford-born Stephen Odell, a former senior executive at Ford.
Evraz said the resignations were “in light of the Financial Sanctions”. It is understood that the measures against Abramovich do not legally require board members to quit.
“Evraz is deeply concerned and saddened by the Ukraine-Russia conflict and hopes that a peaceful resolution will be found soon,” the company said in a statement today.
The UK government yesterday also hit Abramovich’s former business partner Oleg Deripaska with sanctions, casting a pall over his aluminium and energy company En+.
Last night the company argued the decision had “no impact on the Group or its subsidiaries, and they remain free from sanctions worldwide.” That is despite the fact Deripaska owns almost 45% of the company.
En+ struck a deal with the US in 2019 to cut his voting rights to 35% and avoid sanctions after the Trump administration placed restrictions on Deripaska. The company argues the arrangement applies to British sanctions too.
Earlier this week former UK energy minister Lord Barker bowed to intense pressure and quit as chairman of En+.
