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NLMK Acquires Additional Stake in NSMMZ
07/17/2009 - Novolipetsk Steel acquires a 25% stake in NSMMZ, increasing its ownership in the company to 57%.
Novolipetsk Steel (NLMK) has acquired a 25% stake in NSMMZ, a Maxi-Group production facility, from Metallurgical Holding.
The acquisition increases NLMK’s ownership to 57%, including the shares that NLMK acquired in the loans-for-shares auction conducted on June 25, 2009.
Before this acquisition, a 25% stake in NSMMZ was pledged by one of NSMMZ’s creditors and was redeemed by NLMK by direct guarantee. The transaction was closed at a market price based on the results of an open auction for NSMMZ shares held on June 25, 2009.
NLMK said the acquisition will enable it to more efficiently manage the subsidiaries comprising its long steel segment. Acquisition of the additional stake in one of Maxi-Group’s major production assets also allows NLMK to provide guarantees while investing in Maxi-Group assets.
Novolipetsk Steel is a world-class steel producer with operations spanning mining, steelmaking and rolling. A vertically integrated steel producer, NLMK’s operations are conducted through its main steelmaking and rolling facility in Lipetsk, which has a total annual steelmaking capacity of about 9.4 million tonnes of crude steel; the Danish steel rolling company, DanSteel A/S; and Russian electrical steel manufacturer VIZ-Stal.
NLMK also operates Stoilensky, Russia’s third-largest iron ore producer; Russian coke-chemical producer JSC Altai-koks; and mining operations including Dolomite, a furnace dolomite producer, and Stagdok, a fluxing limestone producer. The company also owns LLC Independent transport company (NTK), which coordinates cooperation with both OJSC Russian Railways and ports administration for export destined supplies.
In 2008, NLMK reported sales revenue of USD11.7 billion, an EBITDA margin of 39%, and the production of 10.5 million tonnes of steel. The company’s range of products includes pig iron, slabs, hot-rolled steel, and a variety of value-added steel products, such as cold-rolled sheet, electrical steel and other specialty flat products.
