Moscow, August 12, 2005 – Evraz Group S.A. (LSE: EVR), one of the leading vertically integrated steel production and mining businesses with operations mainly in Russia, today announces it acquired 75% plus 1 share of Palini e Bertoli SpA. (“Palini & Bertoli”, “Palini”).
The acquisition will allow Evraz Group S.A. to build on Palini's strengths as a producer of customized, high-quality plate products to penetrate new geographic markets, secure captive customer base for its slabs outside Russia and further improve the margin from the sale outside Russia of higher value-added steel products.
The remaining 25% less 1 share would be held by certain of Palini's former owners (Annia S.r.l.), including members of its senior management, and would be subject to a call option, pre-emptive rights and lock-up arrangements in favor of Evraz as well as a put option in favor of the current shareholders.
The acquisition was financed by a combination of debt and equity. MPS Venture SGR, a private equity arm of Monte dei Paschi Group, was one of the selling shareholders in the transaction. Morgan Stanley & Co. Limited acted as financial advisor and Pavia e Ansaldo acted as a legal advisor to Evraz on this transaction. Debt finance was provided by ABN AMRO N.V. Annia S.r.L. was supported by Studio Legale Montanari e Associati.
Commenting on the acquisition, Alexander Abramov, Evraz Group Chairman and Chief Executive Officer, said:
“The acquisition of Palini & Bertoli is in line with our strategy of capturing additional margin through focused acquisitions of high-quality re-rolling facilities worldwide. This transaction, along with a recent winning bid for Vitkovice Steel, establishes us as a player in the high value-added European steel plate market. We are pleased that Palini’s management team, headed by its ?EO Giampiero Gori, will be joining Evraz Group and believe they will be an integral part of our effort in creating value for our shareholders.”
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