The Minority Shareholders Return: The Consequences of the Case of Solikamsk Plant’s Shares Withdrawal: Comment by Sergei Vodalagin for Forbes

Investors who bought Solikamsk Magnesium Plant (SMZ) exchange stocks remain their owners. Their stocks should not be withdrawn as part of the privatization of the enterprise. The decision was made on May 5^th by the Perm 17^th Arbitration Appeal Court. Forbes has reported on several times about the proceedings, which began in August 2022. Than happened when General Procurator's Office first announced a demand to seize shares for minority shareholders.

By that time, the court, following by the General Procurator's Office lawsuit in October 2021, had already ruled to seize 89.5% of the shares from the majority shareholders in favor to the state and seized the property of SMZ. Thus, after 30 years, the state regained the control over a strategic enterprise, which is the largest supplier of rare earth metals and magnesium products. These raw materials are used, among other things, in the defense industry, mechanical engineering and nuclear energy. The seized shares were later transferred to Rosatom.

The Solikamsk Magnesium Plant case set a precedent. However, consequences that drove it to this to are still not fully understood.