Mechel Reports Acquiring Controlling Stake in Vanino Sea Trade Port OAO
MOSCOW, Jan. 14, 2013 (GLOBE NEWSWIRE) -- Mechel OAO (NYSE:MTL), one of the
leading Russian mining and metals companies, reports acquiring 55% (73.33% of
common shares) of Vanino Sea Trade Port OAO. The acquisition was made in line
with the company's strategy of developing its mining division in a bid to
expand its export capacities and reduce transport costs in line with planned
increases in coal mining volumes.
On December 29, 2012, the Government of the Russian Federation issued the
decree #2608-r with respect to the disposal of federally owned shares of
Vanino Sea Trade Port OAO (55% of share capital / 73.33% of common shares)
whereby the buyer and the cost of the share package were confirmed. Mechel OAO
logistics subsidiary Mecheltrans OOO was confirmed as the buyer. The sum of
the transaction totalled some 15.5 billion rubles. Earlier Mecheltrans OOO won
the auction for the port's controlling stake, which was held on December 7,
Port Vanino is located in naturally deep Vanina Bay in the Strait of Tartary
which links the Pacific Ocean's Sea of Okhotsk and Sea of Japan. Vanino is the
largest transport hub in the Khabarovsk Region and one of Russia's ten largest
ports. Its cargo turnover in 2012 totalled some 6 million tonnes. Vanino
handles cargo bound for Russia's North-East, Japan, South Korea, China,
Australia, the United States and other Pacific states. Navigation at the port
is open year round. Vanino is a universal port that fits ideally into the
logistics of Mechel's deliveries to Asia Pacific. Using its capacities will
enable the company to consolidate its position as one of the world's largest
producers of metallurgical coals and significantly expand its customer base.
Port Vanino can process vessels up to 45,000 tonnes deadweight. Its
infrastructure comprises 16 berths, storehouses and open storage space. Vanino
is equipped with 64 cranes of 6 to 100 tonne hoisting capacity. The port also
has a specialized container terminal. Open storage space totals 160,000 square
meters, with usable storehouse area of some 37,000 square meters. Besides
coal, the port can also handle ferrous and non-ferrous metals, ferroalloys,
timber, mineral fertilizers, alumina, containers and other cargo.
"By gaining access to Port Vanino's transhipment capacities, Mechel
significantly expands its export capacities to Asia Pacific. Port Vanino is
located only some 1,500 kilometers away from the company's Yakutia coal
assets. Port Vanino's operations will indisputably improve our ability to
manage the logistics of our deliveries, expand the range of our exports due to
greater storage capacity and minimize our dependency on transport markets.
"The fact that Port Vanino's coal transhipment capacities may be increased as
early as in 2013 to 7 million tonnes a year at little expense and without any
significant reconstruction of its facilities, gives us the chance of greatly
reducing investment costs for construction of our own terminal at Vanino in
the next 3-5 years.
"I would like to note separately that as a result of this transaction Mechel
will ensure guaranteed sales volumes of the group's coal products, including
those produced at the Elga deposit," Mechel OAO's Chief Executive Officer
Evgeny Mikhel commented.
Mechel is one of the leading Russian companies. Its business includes four
segments: mining, steel, ferroalloy and power. Mechel unites producers of
coal, iron ore concentrate, nickel, ferrochrome, ferrosilicon, steel, rolled
products, hardware, heat and electric power. Mechel products are marketed
domestically and internationally.
The Mechel OAO logo is available at
Some of the information in this press release may contain projections or other
forward-looking statements regarding future events or the future financial
performance of Mechel, as defined in the safe harbor provisions of the U.S.
Private Securities Litigation Reform Act of 1995. We wish to caution you that
these statements are only predictions and that actual events or results may
differ materially. We do not intend to update these statements. We refer you
to the documents Mechel files from time to time with the U.S. Securities and
Exchange Commission, including our Form 20-F. These documents contain and
identify important factors, including those contained in the section captioned
"Risk Factors" and "Cautionary Note Regarding Forward-Looking Statements" in
our Form 20-F, that could cause the actual results to differ materially from
those contained in our projections or forward-looking statements, including,
among others, the achievement of anticipated levels of profitability, growth,
cost and synergy of our recent acquisitions, the impact of competitive
pricing, the ability to obtain necessary regulatory approvals and licenses,
the impact of developments in the Russian economic, political and legal
environment, volatility in stock markets or in the price of our shares or
ADRs, financial risk management and the impact of general business and global
CONTACT: Mechel OAO
Tel: +7 495 221-88-88
Mechel OAO Logo
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