December 27, 2010, Moscow – MMC Norilsk Nickel (the Company) updates its investors, shareholders and all interested parties on latest developments regarding the offer to purchase 25% stake in the Company made by MMC Norilsk Nickel to UC Rusal on December 16, 2010.

MMC Norilsk Nickel confirms its interest in this transaction and informs that the Company has accumulated significant funds to purchase UC Rusal’s stake. The Company’s Management is positive that in current conditions it is a logical step facilitating the resolution of the corporate conflict, which hampers the growth of shareholder value and diverts the resources of the Company. Obviously, our approach to resolution of the conflict meets the interests of UC Rusal and its shareholders, as substantial cash flow from the sale of MMC Norilsk Nickel stake will allow the aluminum producer to manage the overstretched balanced sheet, currently depressing its market capitalization. Our thoughts were confirmed by the fact that UC Rusal shares gained 5% immediately after MMC Norilsk Nickel announced the offer.

We are aware that the transaction is supported by two UC Rusal shareholders – M.D. Prokhorov and V.F. Vekselberg. The management of MMC Norilsk Nickel in its turn is ready to negotiate potential enhancements of the offer price. At the same time, however, all parties should understand that the final transaction price can not exceed the maximum level which allows the Company to comfortably sustain its current production and implement smoothly its long-term production strategy, social programs and modernization plan.

Unfortunately, despite the positive attitude of the majority of parties involved, the full-fledged negotiation process is yet to begin.

The deadline for UC Rusal response to MMC Norilsk Nickel offer is 15:00 (Moscow time) on December 28. We have to state that in case the negotiations on the proposed transaction fail, MMC Norilsk Nickel will have to implement other means to neutralize negative effects of the shareholders’ conflict on current operation of the Company and its strategic development. Striving to increase the shareholder value of the Company, MMC Norilsk Nickel will be intending to present a general buy-back proposal for approval by the Board of Directors. The Company has accumulated enough cash in hand to conduct it without additional external financing.

It should be noted, however, that if UC Rusal rejects the offer, MMC Norilsk Nickel will not be able to propose to the aluminum producer such lucrative terms for exiting its investment in MMC Norilsk Nickel in the short and medium term.

The management of the Company plans to continue acting in the best interests of all shareholders and the Company itself. We believe that the implementation of the management’s proposals will create additional shareholder value in both cases, including the purchase of UC Rusal’s stake and completion of shareholders’ conflict, and the execution of the long-term program purported to increase the shareholder value of MMC Norilsk Nickel.

ABOUT MMC NORILSK NICKEL:

MMC Norilsk Nickel, a company incorporated under the laws of the Russian Federation, is the largest diversified mining and metals company in Russia, the world's largest producer of nickel and palladium and one of the world's largest producers of platinum, rhodium, copper and cobalt. In addition to this, MMC Norilsk Nickel produces a large number of other by-products, including gold, silver, tellurium, selenium, iridium and ruthenium.

The key production units of the Company’s group in Russia are at the Polar and Kola Peninsulas. MMC Norilsk Nickel international assets include operations in Finland, USA, Australia, Botswana and South Africa.
MMC Norilsk Nickel’s shares are traded at MICEX and RTS.

ADR’s on the Company’s shares are traded on the other the counter market in the US and at the London and Berlin stock exchanges.