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Gazprom's friends in high places

The Kremlin has killed plans to increase dividends at state firms. Gazprom is off the hook again

Firmer oil prices have left the Kremlin feeling generous—to its friends. Russia's government has decided not to fulfill a decree to force state companies to pay out dividends worth 50% of profits. Gazprom is a major beneficiary. Investors who took the plunge on the back of the government's pledge lose out. A move to double the company's dividends was described last year by Citigroup's veteran Russia analyst Ron Smith as "a potential game changer". But that potential won't be realised and the big losers are portfolio investors who piled into Gazprom, Rosneft and Transneft, each state controlled, expecting that payouts would rocket from their current levels. The Kremlin's calculus changed af

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