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United Company RUSAL Plc: Continuing Connected Transaction

  United Company RUSAL Plc:Continuing Connected Transaction

Business Wire

HONG KONG -- November 12, 2012

Regulatory News:

United Company RUSAL Plc (Paris:RUSAL) (Paris:RUAL):

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong
Limited take no responsibility for the contents of this announcement, make no
representation as to its accuracy or completeness and expressly disclaim any
liability whatsoever for any loss howsoever arising from or in reliance upon
the whole or any part of the contents of this announcement.

                           UNITED COMPANY RUSAL PLC
        (Incorporated under the laws of Jersey with limited liability)
                              (Stock Code: 486)

                      CONTINUING CONNECTED TRANSACTIONS


The Board announces that, in their usual and ordinary course of business,
members of the Group have entered/will enter into a variety of Insurance
Contracts with Ingosstrakh and/or its subsidiaries (including INGO Ukraine and
INGO Armenia) (being associates of Mr. Deripaska), pursuant to which such
insurance companies provide various insurance services to the Group, including
liability insurance, cargo insurance, motor hull insurance, property insurance
and business interruption insurance.


INSURANCE CONTRACTS

The Board announces that, in their usual and ordinary course of business,
members of the Group have entered/ will enter into a variety of Insurance
Contracts with Ingosstrakh and/or its subsidiaries (including INGO Ukraine and
INGO Armenia) (being associates of Mr. Deripaska), pursuant to which such
insurance companies provide various insurance services to the Group, including
liability insurance, cargo insurance, motor hull insurance, property insurance
and business interruption insurance.

The terms of the Insurance Contracts which are subsisting in 2012 or onwards
are set out in the table below. The relevant premium under the Insurance
Contracts is to be satisfied in cash via wire transfer. The Board considers
that all the Insurance Contracts are on normal commercial terms.

Type of        Date of                   Transaction   Transaction   Duration     Payment
Insurance     Contract  Counterparty  amount in    amount in    of         terms
                                         2012 (USD)    2013 (USD)    contract
                                                                                               
Non-life
insurance:                                                                        Under
compulsory                                                                        compulsory
liability                                                                         insurance —
insurance                                                                         quarterly,
connected                                                                         before the
with                                                                              beginning of
operating      April to   Ingosstrakh,                                            the relevant
the            May        INGO Ukraine                                            quarter;
hazardous      2012       and INGO       886,254       297,709       One year     under other
objects,       (Note 1)   Armenia                                                 insurance
compulsory                                                                        (general
professional                                                                      liability
liability                                                                         insurance) -
insurance                                                                         within 30-40
and general                                                                       days from
liability                                                                         the date of
insurance                                                                         inception
program
                                                                                               
                                                                                  Six equal
                                                                                  instalments,
                                                                                  the first
                                                                                  payment to
Non-life                                                                          be made
insurance:     11 May                                                Up to 31     within 45
cargo          2011       Ingosstrakh    1,232,725     N/A           October      days from
insurance                                                            2012         the date of
program                                                                           inception,
                                                                                  adjustable
                                                                                  on the
                                                                                  actual sales
                                                                                  turnover
                                                                                               
Non-life
insurance:                                                                        Within 2
directors      6                                                     Up to 30     months from
and officers   December   Ingosstrakh    25,084        N/A           October      the date of
liability      2011                                                  2012         inception
insurance
program
                                                                                               
Non-life
insurance:                Ingosstrakh,                               Up to 24     Within 40
general        1 June     INGO Ukraine   12,030        N/A           April        days from
liability      2011       and INGO                                   2012         the date of
insurance                 Armenia                                                 inception
program
                                                                                               
Non-life
insurance:
third party    During     Ingosstrakh
motor          2012       and INGO       200,000       N/A           One year     Before the
liability      (Note 1)   Armenia                                                 inception
and motor
hull
insurance
                                                                                               
                                                                                  Two equal
                                                                                  instalments,
                                                                                  the first
                                                                                  payment to
Non-life                                                                          be made
insurance:                Ingosstrakh,                                            within 2
property and   1 June     INGO Ukraine                                            months from
business       2011       and INGO       2,718,924     N/A           One year     the date of
interruption              Armenia                                                 inception,
insurance                                                                         the second
program                                                                           payment be
                                                                                  made within
                                                                                  9 months
                                                                                  from date of
                                                                                  inception.
                                                                                               
                                                                                  Two equal
                                                                                  instalments,
                                                                                  the first
                                                                                  payment to
Non-life                                                                          be made
insurance:                                                                        within 2
property and              Ingosstrakh,                                            months from
business       1 June     INGO Ukraine   3,794,015     2,677,085     One year     the date of
interruption   2012       and INGO                                                inception,
insurance                 Armenia                                                 the second
program                                                                           payment to
                                                                                  be made
                                                                                  within 9
                                                                                  months from
                                                                                  date of
                                                                                  inception.
                                                                                               
                                                                                  First
                                                                                  payment (USD
                                                                                  1,300) -
                                                                                  within 15
                                                                                  days from
                                                                                  the date of
                                                                                  inception,
Non-life                                                                          and
insurance:     16                                                    Up to 31     thereafter
project        February   Ingosstrakh    44,558        N/A           December     quarterly in
cargo          2012                                                  2012         accordance
insurance                                                                         with the
                                                                                  actual
                                                                                  amount of
                                                                                  shipments
                                                                                  within 15
                                                                                  days from
                                                                                  the end of
                                                                                  the relevant
                                                                                  quarter

                                                                        
Type of      Date of                   Transaction   Transaction   Duration     Payment
Insurance    Contract   Counterparty   amount in     amount in     of           terms
                                       2012 (USD)    2013 (USD)    contract
                                                                                             
Non-life                                                                        Four equal
insurance:   During                                                             instalments,
cargo        November   Ingosstrakh    239,332       1,372,771     One year     adjustable
insurance    2012                                                               on the
program                                                                         actual sales
                                                                                turnover
                                                                                             
Non-life
insurance:
directors    During                                                             Within 2
and          November   Ingosstrakh    4,415         25,241        One year     months from
officers     2012                                                               the date of
liability                                                                       inception
insurance
program
                                                                                             
Non-life
insurance:
third        expected
party        to be      Ingosstrakh                                             Before the
motor        entered    and INGO       N/A           205,308       One year     inception
liability    into in    Armenia
and motor    2013
hull
insurance
                                                                                             
             expected                                                           Quarterly
Non-life     to be                                                              payments,
insurance:   entered                                                            within 15
property     into by    Ingosstrakh    9,354         71,936        One year     days from
in storage   the end                                                            the
insurance    of                                                                 beginning of
             December                                                           the relevant
             2012                                                               quarter
                                                                                             
             Total                     9,166,691     4,650,050
             amount:
                                                                                             

Note 1: A series of insurance contracts were entered into during the period.

Given the large number of Group companies which were contracting parties to
the Insurance Contracts, the inclusion of the names of each of the relevant
member of the Group in this announcement may not provide useful information to
the public and would be unduly burdensome for the Company.

THE AGGREGATION APPROACH AND THE ANNUAL AGGREGATE TRANSACTION AMOUNTS

Pursuant to Rule 14A.25 of the Listing Rules, the Insurance Contracts are
required to be aggregated as they are entered into by members of the Group
with the associates of Mr. Deripaska and the subject matter of each contract
relates to the provision of insurance services by the associates of Mr.
Deripaska to the Group.

The Insurance Contracts were/will be entered into from time to time. In the
past, the Insurance Contracts constituted de minimis continuing connected
transactions of the Company and were therefore exempt from the reporting,
announcement and independent shareholders’ approval requirements under Chapter
14A of the Listing Rules. It has recently come to the Board’s attention that
the expected annual aggregate amount under the Insurance Contracts (taking
into account the new contracts which are expected to be entered into in
November and December 2012) for the financial year ending 31 December 2012
will cross 0.1% under the consideration ratio.

The annual aggregate transaction amounts payable by the Group to the relevant
insurance companies under the Insurance Contracts for the financial years
ending 31 December 2012 and 31 December 2013 are expected to be not exceeding
approximately USD9.17 million and USD4.65 million respectively. The annual
aggregate transaction amounts for the financial years ending 31 December 2012
and 31 December 2013 are estimated by the Directors based on the need for the
insurance services by the Group and the total contract price under the
Insurance Contracts.

REASONS FOR AND BENEFITS OF THE INSURANCE CONTRACTS AND TRANSACTIONS
THEREUNDER

The Insurance Contracts are entered into for the purpose of various types of
non-life insurance including liability insurance, cargo insurance, motor hull
insurance, property insurance and business interruption insurance. The Company
considers that the transactions contemplated under the Insurance Contracts are
for the benefit of the Company as they cover its risk exposures and are in
line with best practices in risk management of major corporations worldwide.

The premium paid or payable under the Insurance Contracts has been determined
with reference to the market price or on terms no less favourable than those
prevailing in the Russian or international market for insurance services of
the same type and coverage as those offered by Ingosstrakh, INGO Ukraine and
INGO Armenia to independent third parties.

The Directors (including the independent non-executive Directors) consider
that the Insurance Contracts are on normal commercial terms which are fair and
reasonable and the transactions contemplated under the Insurance Contracts are
in the ordinary and usual course of business of the Group and in the interests
of the Company and its shareholders as a whole.

None of the Directors has a material interest in the transactions contemplated
by the Insurance Contracts save for Mr. Deripaska who is directly and
indirectly beneficially interested in more than 30% of each of Ingosstrakh,
INGO Ukraine and INGO Armenia, and Ms. Vera Kurochkina who is a director of
Ingosstrakh. Accordingly, Mr. Deripaska and Ms. Vera Kurochkina did not vote
on the Board resolutions for approving the Insurance Contracts.

LISTING RULES IMPLICATIONS

Mr. Deripaska is directly and indirectly beneficially interested in more than
30% of each of Ingosstrakh, INGO Ukraine and INGO Armenia. Each of
Ingosstrakh, INGO Ukraine and INGO Armenia is therefore an associate of Mr.
Deripaska, the chief executive officer and an executive Director of the
Company. On this basis, each of Ingosstrakh, INGO Ukraine and INGO Armenia is
a connected person of the Company under the Listing Rules. Accordingly, each
of the transactions contemplated under the Insurance Contracts constitutes a
continuing connected transaction of the Company.

The respective annual aggregate transaction amount for the financial year
ending 31 December 2012 of the continuing connected transactions under each of
the Insurance Contracts is individually de-minimis, but when aggregated
together with one another, is more than 0.1% but less than 5% under the
applicable percentage ratios. Accordingly, pursuant to Rule 14A.34 of the
Listing Rules, the transactions contemplated under the Insurance Contracts are
only subject to the reporting and announcement requirements set out in Rules
14A.45 to 14A.47, the annual review requirements set out in Rules 14A.37 to
14A.40 and the requirements set out in Rules 14A.35(1) and 14A.35(2) of the
Listing Rules. These transactions are exempt from the independent
shareholders’ approval requirements under Chapter 14A of the Listing Rules.

Information on the Insurance Contracts for the financial year ending 31
December 2012 will be included in the next annual report and accounts of the
Company in accordance with Rule 14A.46 of the Listing Rules where appropriate.

PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY, INGOSSTRAKH, INGO UKRAINE AND
INGO ARMENIA

The Company is principally engaged in the production of aluminium and alumina.
The Company’s assets include bauxite and nepheline ore mines, alumina
refineries, aluminium smelters, casthouse business for alloys production,
aluminium foil mills and production of aluminium packaging materials as well
as power-generating assets. Spread across 19 countries in five continents, the
operations and offices of the Company employ more than 72,000 people.

Each of Ingosstrakh, INGO Ukraine and INGO Armenia is principally engaged in
the provision of insurance and reinsurance services.

DEFINITIONS

In this announcement, the following expressions have the following meanings,
unless the context otherwise requires:

“associate”             has the same meaning ascribed to it under the
                         Listing Rules.
“Board”                  the board of Directors of the Company.
                         United Company RUSAL Plc, a limited liability
“Company”                company incorporated in Jersey, the shares of which
                         are listed on the main board of the Stock Exchange.
“connected person”       has the same meaning ascribed to it under the
                         Listing Rules.
“continuing connected    has the same meaning ascribed to it under the
transaction”             Listing Rules.
“Director(s)”            the director(s) of the Company.
“Group”                  the Company and its subsidiaries.
                         Insurance Closed Joint-Stock Company «INGO
“INGO Armenia”           Armenia», a company incorporated under the laws of
                         Armenia, and a subsidiary of Ingosstrakh.
                         Private Joint-Stock Insurance Company «INGO
“INGO Ukraine”           Ukraine», a company incorporated under the laws of
                         Ukraine, and a subsidiary of Ingosstrakh.
                         Ingosstrakh Joint Stock Insurance Company Ltd., a
“Ingosstrakh”            company incorporated under the laws of the Russian
                         Federation.
                         the contracts between certain members of the Group
                         and certain insurance companies (being associates
“Insurance Contracts”    of Mr. Deripaska) including Ingosstrakh, INGO
                         Ukraine and INGO Armenia, pursuant to which such
                         insurance companies provides various non-life
                         insurance services to the Group.
“Listing Rules”          The Rules Governing the Listing of Securities on
                         the Stock Exchange.
                                                                             
“Mr. Deripaska”          Mr. Oleg Deripaska, the chief executive officer and
                         an executive Director of the Company.
“percentage ratios”      the percentage ratios under Rule 14.07 of the
                         Listing Rules.
“Stock Exchange”         The Stock Exchange of Hong Kong Limited.
“subsidiary”             has the same meaning ascribed to it under the
                         Listing Rules.
“substantial             has the same meaning ascribed to it under the
shareholder”             Listing Rules.
“USD”                    United States dollars, the lawful currency of the
                         United States of America.
                                       By Order of the Board of Directors of
                                      United Company RUSAL Plc
                                       Vladislav Soloviev
                                       Director

12 November 2012

As at the date of this announcement, the executive Directors are Mr. Oleg
Deripaska, Ms. Vera Kurochkina, Mr. Maxim Sokov and Mr. Vladislav Soloviev,
the non-executive Directors are Mr. Dmitry Afanasiev, Mr. Len Blavatnik, Mr.
Ivan Glasenberg, Mr. Maksim Goldman, Ms. Gulzhan Moldazhanova, Mr. Christophe
Charlier, Mr. Artem Volynets, Mr. Dmitry Yudin, Mr. Vadim Geraskin, and the
independent non-executive Directors are Mr. Barry Cheung Chun-yuen, Dr. Peter
Nigel Kenny, Mr. Philip Lader, Ms. Elsie Leung Oi-sie and Mr. Matthias Warnig
(Chairman).

All announcements and press releases published by the Company are available on
its website under the links http://www.rusal.ru/en/investors/info.aspx and
http://www.rusal.ru/en/press-center/press- releases.aspx, respectively.

Contact:

United Company RUSAL Plc
 
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