EVRAZ sells EVRAZ Vitkovice Steel
EVRAZ plc (LSE: EVR) (“EVRAZ” or the “Company”) announces the signing and closing of the sale of its wholly-owned subsidiary EVRAZ Vitkovice Steel (“EVS”) to a group of private investors (Martinley Holdings Limited, Nabara Holdings Limited, Vitect Services Limited, Hayston Investments Limited and Dawnaly Investments Limited, with each buying 20% of EVS), for a gross consideration of US$89 million adjustable for the actual level of EVS working capital. In addition the buyers have assumed US$198 million of EVS debt liabilities, including the repayment of US$128 million of EVRAZ’s inter-company debt.
EVRAZ will apply the sales proceeds for general corporate purposes, including, but not limited to, the repayment of some of its debt.
EVS, which has been a part of the Company since November 2005, is a manufacturer of steel hot rolled products located in Ostrava in the Czech Republic. In 2013, EVS produced 571 thousand tonnes of steel products.
According to EVS standalone financial statements prepared in accordance with IFRS, in 2013 EVS generated US$442 million of revenue from continuing operations. As of 31 December 2013, EVRAZ Vitkovice Steel had gross assets of US$278 million. For the year ended 31 December 2013, it produced a gross profit of US$31 million, US$(2) million of EBITDA and a loss before tax from continuing operations of US$32 million. This loss includes, inter alia, foreign exchange loss of US$8.5 million, interest expense of US$6.6 million and other expenses related to stoppages of operations of US$9.7 million.
The plant employs just over 1,000 people.
It is expected that the transaction will not affect EVS production or the composition and number of its work force.
Alexander Frolov, EVRAZ’s CEO, said,
“We continue to focus on streamlining our business, concentrating management’s efforts on the key assets and deleveraging. The disposal of Vitkovice Steel is part of that strategic initiative.”
For further information:
VP, Corporate Communications
London: +44 207 832 8998 Moscow: +7 495 937 6871
Director, Investor Relations
London: +44 207 832 8990 Moscow: +7 495 232 1370