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Evraz to acquire selected assets in Ukraine

Date of publication: 11.12.2007

December 11, 2007 - Evraz Group S.A. (LSE: EVR) (“Evraz”) announces signing of an agreement to acquire majority share holdings in selected production assets in Ukraine which include the following: 

    • a 99.25% share holding in the Sukhaya Balka iron ore mining and processing complex with a total annual production capacity of 3.75 million tonnes of iron ore;
    • a 95.57% share holding in the Dnepropetrovsk Iron and Steel Works with a total annual capacity of 1.8 million tonnes of pig iron and 1.23 million tonnes of crude steel; and
    • three coking plants (Bagleykoks - 93.74%, Dneprkoks – 98.65%, and Dneprodzerzhinsk Coke Chemical Plant – 93.83% of shares outstanding) with a total annual capacity of 3.52 million tonnes of metallurgical coke.

Evraz will make a payment for the acquired assets with a combination of cash and new equity.

The final terms and structure of the deal will be voted by Evraz’s Board of Directors based on a fairness opinion provided by a reputable international appraisers’ organisation that will conduct an independent valuation of the assets.

Once approved by the Board, the deal will not be subject to any other, including regulatory, approvals and is expected to be closed in the first quarter of 2008.

Commenting on the strategic benefits of the acquisition, Alexander Frolov, Evraz’s Chairman and Chief Executive Officer, said:

“We view this transaction as yet another important step in realisation of our strategies. The acquisition will allow us to increase iron ore self-sufficiency and ensure further upstream integration. It will also create captive intra-group coke-making demand for the excess production of the Company’s coal mines in Siberia. This deal also represents another step in the Evraz’s geographical diversification into one of the lowest cost steel producing regions”.

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For further information:

Evraz Group
Corporate Affairs and Investor Relations
Irina Kibina
Tel: +7 495 232 1370
IR@evraz.com


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