ALROSA Announces Intention to Proceed with International Offering Business Wire MOSCOW -- October 2, 2013 ALROSA: NOT FOR DISTRIBUTION IN THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN This announcement is not being made in, and may not be distributed or sent into the United States, Australia, Canada or Japan These materials are not for distribution, directly or indirectly, in or into the United States (including its territories and possessions, any State of the United States and the District of Columbia). These materials are not an offer or solicitation to purchase or subscribe for any securities in the United States. Securities may not be offered or sold in the United States absent registration with the United States Securities and Exchange Commission or an exemption from registration under the U.S. Securities Act of 1933, as amended (the “Securities Act”). It is not intended to register any part of the offering in the United States or to conduct a public offering of securities in the United States. This document is an advertisement and is not a prospectus for the purposes of Directive 2003/71/EC (and amendments thereto, including Directive 2010/73/EU, to the extent implemented in any relevant Member State and any relevant implementing measure in the relevant Member State). In any EEA Member State that has implemented the Prospectus Directive, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive. The expression “Prospectus Directive” means Directive 2003/71/EC (and amendments thereto, including Directive 2010/73/EU, to the extent implemented in any relevant Member State) and includes any relevant implementing measure in the relevant Member State. This communication is only being distributed to and is only directed at (i) persons who are outside the United Kingdom or (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons in (i), (ii) and (iii) above together being referred to as “relevant persons”). Any securities described herein are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such securities will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this communication or any of its contents. Information contained herein is not an offer or an invitation to make offers, sell, purchase, exchange or transfer any securities in Russia or to or for the benefit of any Russian person or any person in Russia, and does not constitute an advertisement of any securities in Russia. ALROSA ANNOUNCES INTENTION TO PROCEED WITH INTERNATIONAL OFFERING Open Joint Stock Company “ALROSA” (“ALROSA” or the "Company"), the world’s largest diamond mining company based on rough diamond production volume, today announces its intention to proceed with an offering (the “Offering”) of ordinary shares (the “Shares”) admitted to trading on the “A1” quotation list of CJSC MICEX Stock Exchange (“MICEX SE”), a subsidiary of the Moscow Exchange, under the ticker symbol “ALRS”. The Offering will be part of the on-going privatisation programme in the Russian Federation and will involve the sale of the Shares by the Russian Federation and the Republic of Sakha (Yakutia) ("Yakutia"), a subject of the Russian Federation located in the North East of Russia, in which most of the Company’s production assets are based. The following shareholders will offer the Shares as part of the Offering: *The Russian Federation will offer up to 515,547,593 Shares representing approximately 7 per cent in the Company’s share capital. *OJSC RIC Plus, an open joint-stock company, wholly-owned by the Republic of Sakha (Yakutia), will offer up to 515,547,593 Shares representing approximately 7 per cent in the Company’s share capital. *Wargan Holdings Limited, a company organised under the laws of the Republic of Cyprus and controlled by ALROSA, will offer up to 150,237,555 Shares representing approximately 2 per cent in the Company’s share capital. The net proceeds of the Offering to be received by ALROSA from the Shares sold by Wargan Holdings Limited will be used to repay existing debt. The Offering consists of an offering of the Shares (i) in the Russian Federation to institutional and retail investors (including through the facilities of MICEX SE pursuant to the MICEX SE settlement procedures); (ii) in the United States to certain persons reasonably believed to be qualified institutional buyers (“QIBs”), as defined in, and in reliance on, Rule 144A under the Securities Act; and (iii) outside the United States and the Russian Federation to certain persons in "offshore transactions" as defined in, and in reliance on, Regulation S under the Securities Act. Branch office of private unlimited company Goldman Sachs (Russia) is acting as agent (poverenny) in the name and on behalf of the Russian Federation in connection with the sale of the Shares by the Russian Federation and is providing services as organizer of the sale of the Shares by OJSC RIC Plus. Goldman Sachs International, J.P. Morgan Securities plc, Morgan Stanley & Co. International plc and VTB Capital are joint global coordinators and joint bookrunners of the Offering. Renaissance Capital is a joint bookrunner of the Offering. Fedor Andreev, President of ALROSA, said: “We are very excited to be offering ALROSA’s shares both domestically and internationally. We expect that the Offering will help to reinforce our unique position in the global diamond industry. We also expect that the Offering will expand our access to the international capital markets and help to unlock the value of the Company. We will continue to focus on our core business of exploration, mining and sale of rough diamonds, pursuing expansion opportunities in Russia and other regions, such as Africa. We will also continue to improve operational efficiency and to consolidate our position as the global leader in the diamond mining industry. Corporate social responsibility will remain among key priorities, especially in Yakutia where most of our operations and the majority of our 39,000 employees are based.” Olga Dergunova, Deputy Minister for Economic Development of the Russian Federation and Head of the Federal Agency for State Property Management, commented: “This Offering marks an important milestone for both ALROSA and the on-going privatisation programme in the Russian Federation. ALROSA has an important and unique role in the international diamond market. It is also one of the largest Russian mining companies and a key contributor to the local economy in its areas of operation. The Company’s partial privatisation, including the offering of the Shares through the facilities of MICEX SE, is a landmark step in the implementation of the government’s policy of reducing the state’s role in the economy. We believe that high standards of corporate governance and transparency required for publicly traded companies are important for improving the efficiency and profitability of ALROSA’s business”. Egor Borisov, President of Republic of Sakha (Yakutia), further commented: “I am pleased to see the planned part-privatisation of ALROSA under the agreed scheme, which will allow the company to benefit from its engagement with the international capital markets while the state will retain a controlling stake. ALROSA has historically been the backbone of the Yakutian economy, and it remains one of the largest employers and contributors to the regional budget. In Yakutia, we are very proud of the beauty of our land and the wealth of our natural resources. I believe that the Offering of ALROSA shares will help to promote our region to the international community. Yakutia is the world’s leading diamond mining region and it has a lot more to offer”. About ALROSA ALROSA is the largest diamond mining company in the world based on production volume. Its strategic focus is on mining and distribution of rough diamonds. In 2012, ALROSA produced 34.4 million carats of rough diamonds, accounting for 27 per cent of the world’s rough diamond output based on carat volume, according to Kimberley Process statistics. In the six months ended 30 June 2013, the Company produced 17.1 million carats of rough diamonds. ALROSA operates six open-pit mines, three underground mines and thirteen alluvial placers. Its principal mining and processing operations are located in Yakutia, in the north-eastern part of Russia, and Arkhangelsk Region, in the north-western part of Russia. Based on published reserves, ALROSA has the largest JORC Code-compliant reserve base and its JORC Code resource base is one of the largest in the industry. As at 1 July 2013, the Company’s total JORC Code-compliant measured, indicated and inferred resources amounted to 973.0 million carats (68.3% measured and indicated) with an average grade of 1.38 carats/tonne; and its JORC Code-compliant proven and probable ore reserves were 607.5 million carats with an average grade of 1.34 carats/tonne, based on an independent expert report on ALROSA’s resources and reserves by Micon International, mineral industry consultants. In addition, ALROSA owns a 32.8 per cent stake in Catoca Limited, which mines the Catoca kimberlite pipe in Angola. ALROSA has its own marketing and distribution network with offices in all key diamond distribution hubs across the world. In 2012, a majority of ALROSA’s diamonds were sold through long-term contracts, with the rest sold mainly through competitive sales (auctions and tenders) and spot sales. Its customer base includes cutting/polishing companies, vertically integrated jewellery groups and wholesalers. In addition to its diamond mining and distribution business, ALROSA has some non-diamond assets in adjacent business areas. The Company plans to gradually dispose of selected non-diamond assets over the period of 2013-2020. In the six months ended 30 June 2013, ALROSA’s revenue was RUB 82,229 million (six months ended 30 June 2012: RUB 76,529 million; full year 2012: RUB 150,880 million); and its net income amounted to RUB 14,616 million (six months ended 30 June 2012: RUB 16,191 million; full year 2012: RUB 33,634 million), according to its IFRS results. As of 2 October 2013, the Company’s largest shareholders include the Russian Federation with approximately 50.9 per cent stake and Yakutia, together with OJSC RIC Plus, with approximately 32.0 per cent stake. ALROSA is committed to on-going improvement in corporate governance. It has prepared and published its audited annual IFRS financial statements since 2002, and produces its IFRS reviewed statements on a quarterly basis. The Company’s Supervisory Board currently includes five independent non-executive directors, according to Russian standards of independence. Contact: Media Enquiries: College Hill Leonid Fink, Tony Friend, Galyna Kulachek +44 207 457 2020 or ALROSA Media Center +7 (495) 620–92–50, ext. 13-21 E-mail: firstname.lastname@example.org or ALROSA Investor Relations Center +7 (495) 620–92–50, ext. 11-81 E-mail: IR@alrosa.ru
ALROSA Announces Intention to Proceed with International Offering
Press spacebar to pause and continue. Press esc to stop.