* Norilsk co-owners discuss $10 bln dividend over 3 years -
* Norilsk to receive $2 bln from sale of its 7 pct stake
* Dividend proposal may cut Norilsk capex - analyst
* Norilsk shares up 6.3 pct, outperforming sector index
By Polina Devitt
MOSCOW, Dec 5 Russian nickel and palladium giant
Norilsk Nickel may triple dividend payments, sources
said on Wednesday, helping its main owners cut debt and
rewarding new investor Roman Abramovich for his role in ending a
Norilsk's main owners - feuding billionaires Vladimir
Potanin and Oleg Deripaska - are discussing with Abramovich the
payout of dividends totalling $10 billion from 2012-2014, two
sources close to the shareholders said.
"This opportunity is under discussion for a three-year
period, starting from 2012," one said.
A major dividend stream would satisfy Deripaska, main owner
of aluminium giant RUSAL, which is saddled with $10.7
billion in net debts largely inherited from its purchase of a
one-quarter stake in Norilsk before the 2008 financial crash.
Deripaska fought a four-year battle with Potanin, who owns
28 percent of Norilsk through his investment firm Interros, over
strategy, governance and control of cash flows that was finally
resolved on Tuesday.
Chelsea soccer club owner Abramovich also stands to benefit
from increased dividends following his acquisition of a 7.3
percent stake in Norilsk, worth $2 billion, which he has agreed
to hold for three years.
The prospect of juicy dividend payouts sent Norilsk's shares
6 percent higher in Moscow, to 5,184 roubles ($170), late in the
TOO MUCH OF A GOOD THING?
The hefty payout looks a stretch for the Arctic miner,
however, despite its reputation among investors as a cash cow
capable of withstanding even the most severe industry downturn.
"Such a big dividend payment looks a bit aggressive, even if
you take into account the $2 billion that Norilsk will get from
Abramovich for his 7 percent stake," said Sergey Donskoy, metals
and mining analyst at Societe Generale.
Under a conservative commodities price forecast, Norilsk's
net income may reach around $10 billion over a three year period
from 2012 till 2014, Donskoy estimates.
"This (dividend) proposal may be based on strong commodities
price expectations or on a significant decrease in capital
expenditures. It's possible but I wonder if it's sustainable,"
Donskoy added. He sees Norilsk annual capex at $2.3-2.5 billion
during the next three years.
During the past three years Norilsk spent $3.6 billion on
dividend payments, or 30 percent of its 2009-2011 profit from
Interros and RUSAL would not be able to sell shares for five
years and Abramovich's firm Millhouse would not be able to sell
a stake for three years, they said on Tuesday.
Under the complex transaction, Abramovich would buy
quasi-treasury stock, with a further 10 percent stake held in
treasury expected to be cancelled next spring.
As a result, Interros' economic stake in Norilsk would rise
to 31 percent and RUSAL's to 28 percent.
The two investors would then transfer equal stakes of 7.3
percent to an escrow account controlled by Abramovich, bringing
his voting interest to 22 percent, below Potanin's and above
Deripaska's, one source familiar with the matter said.
RUSAL, Norilsk and Interros declined comment.