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MOSCOW, Aug. 1, 2013 (GLOBE NEWSWIRE) --
Mechel OAO (NYSE:MTL)
, one of the leading Russian mining and metals companies, announces signing an agreement for disposal of several ferroalloys assets to Turkey's Yildirim Group.
According to the agreement, Yildirim Group acquires Mechel OAO's Voskhod Mining Plant (Khromtau, Kazakhstan) and Tikhvin Ferroalloy Plant (Tikhvin, Leningrad Region, Russia) for a total of 425 million US dollars.
The buyer will pay the entire sum to Mechel OAO immediately after the deal's closure. In order to close the deal, all required approval by Kazakh and Russian regulatory agencies and both sides' corporate management agencies is due to be obtained.
Société Générale Corporate and Investment Bank, ING Bank and Dechert LLP are advising Mechel on this transaction.
"This agreement was signed in line with the strategy on restructuring the group's assets, earlier approved by our Board of Directors. The funds our company will get from this deal will help the company to deleverage and continue to finance its priority development projects," Mechel OAO's Chief Executive Officer Evgeny Mikhel noted.
Editor's note:Tikhvin Ferroalloy Plant – Located in Tikhvin, Leningrad Region, it is a modern enterprise of a capacity to produce up to 120,000 tonnes per annum of high-carbon ferrochrome used to produce stainless steel. As raw material, the plant uses the chrome ore concentrate produced at Voskhod mining plant.
Voskhod Mining Plant – includes a modern chrome ore mine and a beneficiation plant for further processing of the ore and producing chrome ore concentrate. Voskhod's proved and probable reserves total 20 million tonnes of ore according to JORC standards.
Yildirim Group (www.yildirimgroup.com) — a Turkey-based private diversified industrial group comprising enterprises from ten different industries in various countries.
YILDIRIM Group is the owner of ETI KROM INC., Turkey's largest producer of chrome ore as well as high-quality high-carbon ferrochrome, and of VARGÖN ALLOYS AB, one of the oldest ferrochrome plants in Sweden. The Group is the world's largest hard lumpy chrome ore producer as well as the world's second largest high-quality high-carbon ferrochrome producer.