6 Jan 2009 17:00
Urals Energy Public Company PCL
("Urals Energy" or the "Company")
Update on Discussions and Financing
Urals Energy today announces that discussions regarding a potential offer for the Company with a third party have ended and that no offer has been made.
The Company has discussed and will now seek to agree with Sberbank that, in this circumstance, it will proceed to undertake a disposal of its shares in ZAO Dulisma and in Taas Yuriakh, its two strategic assets in East Siberia, to Sberbank or a subsidiary, in discharge of its obligations to Sberbank under two separate loans totaling $630 million and secured by pledges by Urals Energy of its shares in Taas Yuriakh and 99% of the shares in ZAO Dulisma. Certain trade debt incurred by Taas Yuriakh and ZAO Dulisma is intended to be transferred along with the said companies in such proposed transaction.
The Company has been informed by Sberbank that, with immediate effect, all rights of claim under its existing loans to wholly owned Company subsidiaries have been assigned to Sberbank Capital LLC, a 100% owned subsidiary of Sberbank. In line with this assignment Sberbank has transferred to Sberbank Capital all of its rights as the Secured Party in relation to the loans.
The company has also been informed by Sberbank that it has waived its rights to charge increased default interest for non-timely repayment of the loans at their original maturity dates (November 26 and November 14, 2008, respectively) for the period until December 31, 2008. Currently the amount outstanding under the $500 million loan is the principal only. Under the $130 million loan the amount outstanding is $132.3, consisting of the principal and accrued interest.
The Company will seek to finalise the proposals for the discharge of its obligations to Sberbank as soon as possible. The Company intends shortly to give notice of a shareholder meeting to approve the proposals and will publish a circular setting out the proposals and other information on strategic options for continuing in business.
The Company's liquidity position remains constrained and discussions with a third party regarding a short term working capital facility are ongoing. The Company will now seek a small loan to maintain liquidity until proposals with Sberbank can be finalised. At present, the Company has overdue amounts payable to Dulisma contractors and suppliers that must be partly satisfied by the end of January 2009 and which it will be unable to meet without the granting of this loan or other sources of cash not currently in hand.
Further announcements will be made in due course.
6 January 2009
Enquiries:
| Pelham PR | ||
| Evgeniy Chuikov | +44(0)20 3008 5506 / +44(0)7894 608 606 | |
| Mark Antelme | +44(0)20 3178 6242 / +44(0)752 5951 011 |