Swiss industrial pump manufacturer Sulzer says it is no longer threatened by United States sanctions having reduced the stake of Russian holding company Renova below a 50% threshold.
The company said on Thursdayexternal link it had completed a binding agreement to buy five million shares from Renova. This would shrink Renova’s stake in Sulzer from around 63% to under 49%.
The Winterthur-based firm, which makes pumps for the oil and gas industry, found itself facing the sharp end of a recent US move to target Russian individuals and entities in retaliation for contentious Russian activities in Ukraine, Syria and Europe.
Last week, billionaire Russian oligarch Viktor Vekselberg and his investment company Renova were named on a US “specially designated nationalsexternal link” (SDN) list that would be targeted for economic sanctions. This spelt trouble for any other company at least 50% owned by an SDN, which included Sulzer.
The Swiss company admitted earlier this week that some US bank accounts had been frozen, but it said this affected potential new ventures rather than current day-to-day business. Nevertheless, Sulzer shares took a beating on the stock markets and Swiss media reported that UBS and Credit Suisse banks had stopped trading in the firm’s stock.
Shares in two other Swiss companies with a substantial Renova connection, Oerlikon and Schmolz + Bickenbach, also tumbled this week despite the Russian group holding a stake far below the 50% threshold.
Zug-based commodities trading giant Glencore was also forced to take action to distance itself from two other SDNs, Rusal and EN+. Glencore CEO Ivan Glasenberg said he would step down from his role as a director at Rusal while his company also put on ice a share swap deal involving the Russian SDNs.