4th Apr 2008 07:00
Eurasian Natural Resources Corp Plc04 April 2008 4 April 2008 Eurasian Natural Resources Corporation PLC Completion of US$210 million acquisition of a controlling interest in Serov London - Eurasian Natural Resources Corporation PLC ('ENRC' or, together withits subsidiaries, 'the Group'), a leading diversified and fully integratedKazakh metals and mining company, announces that it has completed theacquisition of a controlling interest in the Serov group and certain relatedentities ('Serov'). Serov was acquired from various entities affiliated with Mr.P Chodiev, Mr. A Ibragimov and Mr. A Machkevitch, all of whom are significantshareholders in ENRC (the 'Founder Shareholders'). This transaction is ENRC'sfirst acquisition outside of Kazakhstan and was described in the IPO Prospectuspublished by ENRC on 7 December 2007. The total cash consideration for the acquisition is US$210 million, including aninitial US$100 million pre-payment made in July 2007. The Group obtained avaluation report and fairness opinion to assist it in determining theappropriate price to be paid. The sale-purchase agreement, signed on 4 December2007, allowed ENRC the right to all dividends or other distributions made after4 December 2007, effectively giving ENRC the economic benefit from that date. Serov is a ferrochrome producer in eastern Russia and owns a chrome ore miningfacility and a ferrochrome smelter. The smelter produces a variety offerroalloys including high, medium and low carbon ferrochrome and has an annualsales volume of approximately 200,000 tonnes. ENRC believes that the acquisition of Serov will help reinforce the marketposition of the Group in the ferrochrome industry and in the region. Inaddition, the transaction will allow the Group to benefit from further verticalintegration within the ferroalloys business. Commenting on the acquisition, Dr. Johannes Sittard, Chief Executive Officer ofENRC, said, "We believe that the operations of Serov will not only complementour existing ferrochrome product range but will also provide ENRC with animportant asset base in Russia, which supports our strategy to pursue expansionopportunities." Sir David Cooksey, the Non-Executive Chairman of ENRC, said, "It is good that wehave completed this transaction, our first as a public company, and we believethat Serov will be an important part of the Group's development. The acquisitionwill provide a strong platform for ENRC in Russia." - ENDS - For further information, please contact: ENRCMounissa Chodieva +44 (0) 20 7389 1879James S Johnson +44 (0) 20 7389 1862 M: CommunicationsHugh Morrison +44 (0) 20 7153 1534Edward Orlebar +44 (0) 20 7153 1523Julia Kalcheva +44 (0) 20 7153 1517 About the acquisition of Serov ENRC NV, a wholly owned subsidiary of the Group, entered into a share purchaseagreement (the 'Serov SPA') with Industrial Metals Technology Limited, ChesswoodHoldings Limited, Blackmore Holdings Limited, Prentice Holdings Limited, CretownCorporate Advisory BV (together, the 'Serov Sellers') and International MineralResources BV ('IMR') (the 'Serov Guarantor'). The Serov Guarantor and the SerovSellers are or were all ultimately indirectly owned equally by the FounderShareholders. Pursuant to the Serov SPA, ENRC NV acquired from the Serov Sellersaggregate direct interests of 75.3% of the shares of OAO 'Serov FerochromeFactory' ('SFF'), 61.7% of the shares of OAO 'Saranovskaya Mine 'Rudnaya'('SMR'), and 51.00% of the shares of OAO 'Serov Metalconcentrate Works' ('SMW'and together with SFF and SMR, the 'Serov Entities', and such interests the'Serov Interests') and 100% of the shares of OOO 'Industrial Metals', whichitself owns 19.95% of the shares of SFF and 7.55% of the shares of SMR. SFF alsoowns directly 19.87% of the shares of SMR and 49.00% of the shares of SMW.Pursuant to the Serov SPA, ENRC NV paid a total aggregate consideration ofUS$210 million (the 'Serov Consideration'), less the amount already paid for thepurchase of IMR Marketing AG and DDK Services Limited, for the purchase of theSerov Interests, US$100 million of which was pre-paid by ENRC NV to the SerovSellers on 16 July 2007. About ENRC Eurasian Natural Resources Corporation PLC is a leading diversified naturalresources group with integrated mining, processing, energy, logistical, andmarketing operations. It is the world's largest producer of ferrochrome, basedon chrome content, the world's sixth largest iron ore exporter by volume andworld's fifth largest supplier of traded alumina by volume. The Group's revenueswere US$3,256 million for the year ended 31 December 2006 and US$1,856 millionfor the six months ended 30 June 2007. EBITDA (pre exceptional items) wasUS$1,256 million for the year ended 31 December 2006 and US$797 million for thesix months ended 30 June 2007. For further information please see the Group'swebsite at www.enrc.com. About IMR International Mineral Resources B.V. ('IMR') is a company owned by certain ofENRC's Founder Shareholders and of which Dr. Johannes Sittard, Chief ExecutiveOfficer of ENRC, is non-executive Chairman. Forward looking statements This document includes forward-looking statements that reflect the current viewsof the management of the Group with respect to future events. Theseforward-looking statements include matters that are not historical facts or arestatements regarding the Group's intentions, beliefs or current expectationsconcerning, among other things, the Group's results of operations, financialcondition, liquidity, prospects, growth, strategies, and the industries in whichthe Group operates. Forward-looking statements are based on current plans,estimates and projections, and therefore too much reliance should not be placedupon them. Such statements are subject to risks and uncertainties, most of whichare difficult to predict and generally beyond the Group's control. The Groupcautions you that forward-looking statements are not guarantees of futureperformance and that if these or other risks and uncertainties materialise, orif the assumptions underlying any of these statements prove incorrect, theGroup's actual results of operations, financial condition and liquidity and thedevelopment of the industry in which the Group operates may materially differfrom those made in, or suggested by, the forward-looking statements contained inthis document. In addition, even if the Group's results of operations, financialcondition and liquidity and the development of the industry in which the Groupoperates are consistent with the forward-looking statements contained in thisdocument, those results or developments may not be indicative of results ordevelopments in future periods. The Group does not undertake any obligation toreview or confirm analysts, expectations or estimates or to release publicly anyrevisions to any forward-looking statements to reflect events that occur orcircumstances that arise after the date of this document. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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