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Yukos gets rid of last of its troubled core shareholders

Russia's beleaguered oil giant Yukos broke ties Monday with the last of six core shareholders who once controlled the company but are now all facing jail or exile in what many see as a politically-driven campaign.

Yukos said in a statement posted on its Web site that it had dismissed Mikhail Brudno as president of Yukos RM, the company's refining and marketing arm.

Brudno, who owns more than 3 percent of Yukos, was charged last month with embezzlement, joining the other five core company shareholders being pursued by the legal authorities either in Russia or abroad in exile.

"Being guided by a Yukos board of directors recommendation that no shareholders should interfere in the company's operational management, the Yukos management board adopted a decision today to relieve Mikhail Brudno of his duties as president of Yukos RM and as a member of the management board," the statement said.

Yukos, Russia's largest oil producer, has been in prosecutors' firing line since June and its main shareholder and Russia's richest man, Mikhail Khodorkovsky, was jailed in late October on fraud and tax evasion charges.

Deputy chairman of the board Yury Beilin said in an interview published Monday that "in order to preserve the company" Yukos would restrict "the participation of Yukos employees or resources in any political or other activities of shareholders."

Khodorkovsky resigned as chief executive in November. The second-biggest shareholder, Leonid Nevzlin, who is in Israel, has been financing the election campaign of a liberal opposition candidate in March presidential elections.

Beilin also told the Vedomosti business daily that the company was likely to reduce its dividend payments. Yukos approved a record US$2 billion dividend payout in October last year.

"The management has suggested to the board of directors that we reassess our dividend policy this year to take into account the additional risks which require establishing a financial reserve," he added.

Another company manager told the daily on condition of anonymity that Yukos would now stop using aggressive tax minimization schemes.

Yukos has been hit with a US$3.4 billion tax bill by the fiscal authorities who claim the company misused tax loopholes to evade taxes.

The attack on Yukos is widely seen as politically motivated after Khodorkovsky angered President Vladimir Putin by financing opposition parties before December parliamentary elections, in which pro-Kremlin forces eventually triumphed.

"The board of directors has to do everything it can to remedy the situation," commented Valery Nesterov, an analyst from Troika Dialog brokerage.

"That's why they are trying to build up protection and keep the company intact, by putting distance between them and shareholders," he added.
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