Shares of U.S. aluminum company Alcoa posted on Monday their largest one-day loss in nine years after the Treasury Department extended the wind-down period for U.S. customers’ transactions with sanctioned Russian rival Rusal by six months.
U.S. persons or companies doing business with the Russian aluminum giant will now have until Oct. 16 to comply with sanctions, a deadline that has been extended from May 7. Alcoa shares plunged more than 13.5% at Monday’s close.
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Rusal, one of the world’s largest aluminum producers, was designated for sanctions on April 6. The company is known for its ties with the Russian oligarch Oleg Deripaska, who is close with President Vladimir Putin. According to Morgan Stanley, it supplied nearly 10% of U.S. aluminum imports last year, according to Morgan Stanley, as reported by Reuters.
“Rusal has felt the impact of U.S. sanctions because of its entanglement with Oleg Deripaska, but the U.S. government is not targeting the hardworking people who depend on RUSAL and its subsidiaries,” Treasury Secretary Steven Mnuchin said in a press release.
Mnuchin added that Rusal has petitioned the U.S. for delisting, which is being considered if Deripaska – the company’s main shareholder – gives up control. Deripaska is a central figure in Special Counsel Robert Mueller’s investigation into Russian interference in the 2016 presidential election.
Rusal was designated for sanctions along with two-dozen other individuals and businesses close to the Russian government early this month.