MECHEL INCREASES ITS STAKE IN THE CHARTER CAPITAL OF TOPLOFIKATSIA ROUSSE AD UP
TO 100%
Moscow, Russia – November 24, 2010 – Mechel OAO (NYSE: MTL), one of the leading
Russian mining and metals companies, announces acquisition of 51% stake in the
charter capital of Toplofikatsia Rousse AD (TPP “Rousse”), located in the
Republic of Bulgaria. As the result Mechel has increased its stake in the
charter capital of the power station up to 100% from the previously owned stake
of 49%.
Consolidation of 100% stake in Toplofikatsia Rousse AD is implemented in line
with Mechel’s power segment development strategy. It provides new opportunities
for realization of electric power in promising European market and will
strengthen Company’s position in power industry.
After Mechel’s acquisition of 49% shares of Rousse TPP in 2007 the station
secured stable consumption of steam coal manufactured by Southern Kuzbass Coal
Company OAO. During the past heating season Europe faced difficulties in gas
supplies, while Kuzbass coal allowed TPP to continue operations amid rising
prices on power-plant fuel. Furthermore the utilization of Kuznetsk Coal Basin’s
high quality coal allows the station to fulfill strict European requirements on
environmental protection with regard to sulfur and volatile substances emissions
without additional investments. The balanced value chain contributes to decrease
in the Company’s expenses and improves power and heat generation efficiency.
Toplofikatsia Rousse runs all municipal heat distribution systems of Rousse city
as well as remote stations and heat sites. TPP provides nearby facilities and
citizens with steam, heat and hot water.
Viktor Gvozdev, CEO of Mechel Energo OOO, commented on the event: «The
continuous development of the Group’s power segment is necessary for the
effective work of the whole Group. The stake increase up to 100% is Mechel’s
logical step in strengthening its positions in power industry and increasing
efficiency of its operations in prospective European power market following the
strategy of increasing output of high value added products».
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Mechel OAO
Ekaterina Videman
Tel: + 7 495 221 88 88
ekaterina.videman@mechel.com
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Mechel is one of the leading Russian companies. Its business includes four
segments: mining, steel, ferroalloy and power. Mechel unites producers of coal,
iron ore concentrate, nickel, steel, ferrochrome, ferrosilicon, rolled products,
hardware, heat and electric power. Mechel products are marketed domestically and
internationally.
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Some of the information in this press release may contain projections or other
forward-looking statements regarding future events or the future financial
performance of Mechel, as defined in the safe harbor provisions of the U.S.
Private Securities Litigation Reform Act of 1995. We wish to caution you that
these statements are only predictions and that actual events or results may
differ materially. We do not intend to update these statements. We refer you to
the documents Mechel files from time to time with the U.S. Securities and
Exchange Commission, including our Form 20-F. These documents contain and
identify important factors, including those contained in the section captioned
“Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in our
Form 20-F, that could cause the actual results to differ materially from those
contained in our projections or forward-looking statements, including, among
others, the achievement of anticipated levels of profitability, growth, cost and
synergy of our recent acquisitions, the impact of competitive pricing, the
ability to obtain necessary regulatory approvals and licenses, the impact of
developments in the Russian economic, political and legal environment,
volatility in stock markets or in the price of our shares or ADRs, financial
risk management and the impact of general business and global economic
conditions.