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Evraz JV Creates Largest Steel Distribution Company in the CIS

12/27/2010 - Evraz Group SA has closed a deal to acquire 100% of the shares of Cassar World Investments Corp., which controls 99.9% of OAO INPROM, a leading metal service company in Russia. The deal will create a joint venture comprising the assets of EvrazMetall and INPROM that will be the largest steel distribution company in the CIS.

Evraz Group SA has closed a deal to acquire 100% of the shares of Cassar World Investments Corp., which controls 99.9% of OAO INPROM, a leading metal service company in Russia.
 
The deal has resulted in creation of a joint venture comprising the assets of EvrazMetall and INPROM that will be the largest steel distribution company in the CIS. In 2010, total steel sales of the combined company are expected to amount to approximately 1.2 million tonnes. Evraz will have a 75% stake in the combined company and INPROM shareholders will have 25% of shares.
 
EvrazMetall — formerly Carbofer Metall, which was acquired by Evraz in October 2009 — comprises a network of metal trading companies with 33 branches in Russia and the CIS countries (Kazakhstan).
 
With a chain of 27 metal centers located in the industrially developed regions of Russia, INPROM distributes products of Russian and CIS steel mills to 20,000 customers across all sectors of the economy. INPROM is the largest metal service company in Russia for metal processing services, and its professional team and strategically located metal centers represent an important competitive advantage. In 2010, INPROM’s sales are expected to exceed 400,000 tonnes with Evraz’s products accounting for one third of those sales.
 
As a result of the new joint venture, Evraz will expand its presence in the steel retail trade in Russia, particularly in the European part and the dynamically developing southern region. The company also expects that it will see an increase in profitability from higher-margin steel product sales.