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ArcelorMittal to Sell 50% Interest in Metal Cord Producer Trefilarbed Rus
12/04/2007 - ArcelorMittal and Severstal-metiz agree on the sale of ArcelorMittal Wire Solutions’ 50% stake in steelcord producer TrefilArbed Rus to Severstal-metiz.
ArcelorMittal and Severstal-metiz have agreed on the sale of ArcelorMittal Wire Solutions’ 50% stake in steelcord producer TrefilArbed Rus (TA Rus) to Severstal-metiz.
The agreement will allow both companies to focus on their current wire strategies. Severstal-metiz aims to develop high value-added products for key Russian and CIS domestic markets, whereas ArcelorMittal Wire Solutions’ main growth area in steelcord is Asia.
ArcelorMittal Wire Solutions and Severstal-metiz had established the joint venture in 2005, with the aim to develop TA Rus on the Russian steelcord market. The joint venture benefited from access to specific technologies provided by ArcelorMittal Wire Solutions.
Following the sale, TA Rus, which is located at Severstal-metiz’ Orel site, will change its name to Orelcord. Its revenues totaled 842,5 million rubles, or about 31 million US dollars, in 2006. In 2006, the company obtained the ISO 9001 quality management certification.
The Severstal-metiz company (Russia)—the metalware division of Severstal—was founded in 2004. The company also incorporates the Ukrainian-based Dneprometiz and the British Carrington Wire Limited companies. One of the biggest players in the European and CIS markets, Severstal-metiz manages businesses that account for over 26% of Russia’s metalware output (40% of export output) and employ more than 11 000 people.
The Severstal-metiz group of companies reported a 15% increase in EBITDA in the first nine months of 2007 (as compared to the first nine months of 2006), amounting to 54 million US dollars. Shipment volumes totaled 796.1 thousand tonnes over the same period, 15% less than same period in 2006. Sales revenues for this accounting period were 754 million US dollars, 25% ahead of the same period in the previous year.
