🕐19.10.09 - 05:18 Uhr

MMK (MMK:LI) acquires 82.6% of Belon coal company



OJSC "Magnitogorsk Iron and Steel Works" (OJSC "MMK") October 16, 2009 MMK closes the transaction on acquisition of 82.6% of Belon coal company OJSC "Magnitogorsk Iron and Steel Works" (MMK) announces that it has closed the transaction to get effective control over 82.6% of OJSC "Belon" (Belon) - one of the leading coal concentrate producers in Russia.

At the final stage of the transaction MMK increased its stake in Onarbay Enterprises Ltd, which owns 82.6% of the Russian coal-producing company Belon, from 50% to 100%. Key transaction highlights: � MMK obtains control over Belon, increasing its stake in the company to 82.6% � The transaction secures stable coking coal supplies to MMK for its steel smelting operations, including supplies of deficit coal grades � The acquisition will allow to continue implementing the investment programme of Belon � Supplies from Belon will account for the bulk of MMK requirement of coking coal concentrate Victor Rashnikov, Chairman of the MMK Board of Directors, stated: "This transaction brings MMK self-efficiency in strategically important input material to a new level.

We are sure that this acquisition will strengthen our competitiveness in the current situation and in the long-term prospect". Structure of the transaction In March 2008 MMK acquired 50% interest in Onarbay Enterprises Ltd, which owed 82.6% of the share capital of Belon.

In October 2009 MMKs share in Onarbay Enterprises Ltd was increased to 100%. As the result, the structure of the Belon share capital is as follows: 82.6% belongs to Onarbay Enterprises Ltd (MMK owns 100% of shares), and 17.4% are in free float on Russian stock exchanges. * * * OJSC Magnitogorsk Iron and Steel Works is among the worlds largest steel producers and is one of the leaders of the Russian steel industry.

The Company is a large steel producing complex encompassing the entire production chain, from preparation of iron ore to downstream processing of rolled steel.

MMK turns out a broad range of steel products with a predominant share of higher value added goods.

In 2008 the Company produced 12 mln tonnes of crude steel and 11mln tonnes of commercial products.

MMK Group sales stood at USD 10.550 bln. OJSC Belon is a rapidly developing coal and coal concentrate producer and one of the leading Russian steel traders.

In 2008 the company produced 5.5 mln tonnes of coal, including 2.9 mln tonnes of coking coal.

Belon sales in 2008 according to RAS stood at USD 1.125 bln, net profit - at USD 124 mln.

The investment programme of the company is designed to increase the production efficiency and market share of Belon.Contacts:
Evgeny Kovtunov tel.

+7 3519 24 93 55 e-mail:



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