Mechel (NYSE:MTL), Russia's largest coking coal miner, is unlikely to suffer the same fate as YUKOS, Russian First Deputy Prime Minister Igor Shuvalov was quoted by Russian news agencies as saying on Tuesday.
"I consider this a most unlikely scenario. Under probability theory we can't exclude anything, but if I had the option, I would rule it out. The most likely scenario is that the company will co-operate with the state authorities," Shuvalov was quoted by Interfax as telling reporters.
Mechel's shares have tumbled in recent days after criticism from Prime Minister Vladimir Putin. YUKOS, once Russia's biggest oil company, was divided up and sold by the Russian state after massive back tax claims. Former YUKOS CEO Mikhail Khodorkovsky was jailed for tax evasion and fraud.
- Via Reuters
Notablecalls: I expect to see an upward move in MTL stock following these comments. I don't think Russia can afford a scandal similar to Yukos. That would represent a significant blow to outside financing.
I consider Putin's recent attack at MTL as a warning shot - one that will not end up damaging the company permanently. I see MTL trading towards the $22-$23 level as soon as today. The stock is flat lining in pre-market and expect the action to pick up after the open.