July 12, 2011 / 7:56 AM / 8 years ago

REFILE-UPDATE 1-Melnichenko cuts stake in K+S to less than 10 pct

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* Stake declines from almost 15 percent in September

* Melnichenko needs funds to exploit Urals potash deposits

* K+S share price falls 1.9 percent

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FRANKFURT, July 12 (Reuters) - Russian tycoon Andrei Melnichenko has cut his stake in German potash miner K+S to less than 10 percent, down from almost 15 percent since the last notification 10 months ago, as he seeks to fund the development of costly potash deposits in the Ural mountains.

K+S said on Tuesday that investment vehicles held by Melnichenko including his EuroChem fertiliser group have reduced their combined stake to 9.9 percent.

A K+S spokesman said he could not comment on Melnichenko’s further plans.

In October last year EuroChem walked away from negotiations to jointly develop with K+S or other foreign partners the Verkhnekamsk potash deposits in the Urals.

EuroChem said at the time it was looking at various funding options, including an IPO, to fund the development on its own.

In March another major shareholder, chemicals giant BASF (BASFn.DE), sold its 10 percent stake in K+S, severing ties with its former subsidiary. (Reporting by Ludwig Burger; Editing by Greg Mahlich)

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