Sulzer’s US accounts frozen but sanctions to be lifted soon

Sulzer's headquarters are in Winterthur but the company has more than 15,000 employees around the world Keystone

Swiss pump maker Sulzer has confirmed its bank accounts in the United States have been frozen as part of Washington’s sanctions against Russian oligarch Viktor Vekselberg.

A spokesman said that the Winterthur-based company is not on the sanctions list, but share prices continued to tumble on Wednesday as a result of their involvement. Sulzer shares ended the day down 8.5%.

Chief executive Greg Poux-Guillaume was quoted as saying Sulzer expected to be “freed” from sanctions within days after a deal meant to trim Vekselberg’s stake in the company to less than 50%.

To do this, Sulzer has agreed to buy five million of its own shares from its largest shareholder, Renova Holdings, which along with Vekselberg – Renova’s chairman – has appeared on a list of US-targeted individuals and entities.

Vekselberg has been caught in the recent wave of punitive US measures that have targeted associates of Russian President Vladimir Putin as punishment for alleged meddling in the 2016 US election and other “malign activity”.

Shares tumble

“We’ve been in contact with the US Office of Foreign Assets Control since Sunday,” the Swiss Finanz und Wirtschaft business newspaper quoted Poux-Guillaume as saying.

“I expect we will have the transaction approved and be freed from the sanctions in a couple of days,” he said.

Sulzer shares have tumbled around 16% since the sanctions were announced. Shares of other Swiss companies in which Renova owns sizable shares, including OC Oerlikon and Schmolz & Bickenbach, have also fallen.

Those companies have said they did not expect sanctions to impact their operations.