UPDATE 2-Russian govt to appoint to Norilsk board

* Russia govt representative to join Norilsk board in Dec

* Two Russian govt representatives to join management

* Norilsk says bought back 26 bln rbls prior to court freeze

* UC RUSAL to demand investigation into share buyback

(Adds details, Norilsk buyback, analyst comment, background)

By Robin Paxton and Polina Devitt

MOSCOW, Nov 5 (Reuters) - Russia's government will have a greater say in managing Norilsk Nickel (GMKN.MM), the world's largest nickel miner, after bailing out one-quarter shareholder United Company RUSAL with a $4.5 billion state loan.

Norilsk will elect a government representative to an enlarged board and appoint two state representatives to its management team as a condition of the loan, UC RUSAL said, in a move that could force compromise between warring shareholders.

"There will be tighter control of management, which will result in better use of financial resources," UniCredit Aton equity analyst George Buzhenitsa said. "It's in the state's interest for this company to run efficiently."

UC RUSAL, majority owned by billionaire Oleg Deripaska, is among the first beneficiaries of the Kremlin's $50 billion rescue package for Russian companies struggling to refinance Western loans during the acute global liquidity crunch.

It received the one-year loan from state bank VEB, or Vnesheconombank, to enable it to repay a loan taken in April to help it purchase a 25 percent-plus-two-shares stake in Norilsk. The stake is being used as collateral against the state loan.

"Everyone understood the government would save RUSAL and wouldn't allow such a huge block of shares to fall onto the market," Deutsche Bank metals analyst Olga Okuneva said.

UC RUSAL and Vladimir Potanin, Norilsk's chairman and single largest shareholder, have publicly disagreed about the company's management, including the election of a new board that effectively strengthened Potanin's control of the miner.

UC RUSAL, itself the world's largest aluminium producer, said in a statement the government representative would be elected to Norilsk's board at an extraordinary shareholders' meeting on Dec. 26. Norilsk did not comment. "This realignment will weaken (Potanin's) influence, encourage increased transparency in the company's decision-making process and provide improved oversight of Norilsk Nickel's operations," UC RUSAL said in the statement.

It said the loan would have an interest rate of LIBOR plus 5 percent, with an option to extend after the initial year at the discretion of the bank's advisory council.

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