NLMK.L Regulatory News (NLMK)

16 Aug 2006 17:31

OJSC Novolipetsk Steel16 August 2006 Novolipetsk Steel (NLMK)16 August 2006 Novolipetsk Steel (NLMK) agrees to sell KMA Ruda. Novolipetsk Steel (LSE: NLMK), a leading Russian steel producer, today announcedthat it has agreed to sell its stake of 92.04% (236,605 ordinary shares) in OJSC"Kombinat KMA Ruda" for USD 300 million. According to the agreement,approximately 60% interest in KMA Ruda is sold to OJSC "KOKS" and around 30%interest is sold to Lesser Enterprises Limited Company for USD 195.5 and 104.5million respectively. The parties are planning to close the transaction beforethe end of the year after seeking the necessary approvals from the StateRegulatory Authorities. This divestment is in line with the previously announced internal restructuringplan. One of key steps of the restructuring plan is optimizing the assetportfolio of NLMK. At the moment the Company's strategy is oriented towards the development of itskey iron ore asset, Stoilensky GOK (SGOK). Stoilensky GOK meets 100% of NLMK'siron ore concentrate requirements. The Stoilensky GOK's development program isclosely correlated with NLMK's development program to meet steel segments' ironore concentrate demand in the future. Proceeds from the transaction will be directed to financing NLMK's investmentprojects, including the Stoilensky GOK's development program. As we statedearlier, the active management of our asset portfolio is an integral part ofNLMK's growth strategy and strengthening our market leadership. KMA Ruda is a mining company located within 350 kilometers of NLMK's productionfacilities in Lipetsk. KMA Ruda supplies iron ore concentrate, with the annualamount of production of 1.8 million tones. Contact: NLMKAnton Bazulev +7 495 915 1575 Financial DynamicsJon Simmons +44 207 831 3113 This information is provided by RNS The company news service from the London Stock Exchange