Russian tycoon Oleg Deripaska's company suing Montenegro over smelter bankruptcy

Russian aluminum baron Oleg Deripaska’s company has launched a 100 million-euro ($1362 million) lawsuit against Montenegro over the handling of its aluminum smelter in the Balkan country.

Deripaska’s Central European Aluminum Company says the case will be heard in Vienna. It accuses the Montenegrin government of “numerous violations” of a settlement agreement.

CEAC bought a nearly 60 per cent stake in Kombinat Aluminijuma Podgorica (KAP) in 2005, but the smelter — once the pride of Montenegrin industry — has constantly lost money. The government bought back nearly half of the stake in 2010 before officially declaring the debt-laden smelter bankrupt this year.

CEAC accuses the government of mismanagement, including preventing the smelter from building its own power plant, which would have helped it survive financially.

Montenegro’s government has denied the accusations.