ALROSA Announces Pricing of Its Offering at RUB35 Per Ordinary Share Business Wire MOSCOW -- October 28, 2013 ALROSA: NOT FOR DISTRIBUTION IN 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 that any part of the offering will be registered in the United States or that a public offering of securities will be conducted in the United States. 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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. For Immediate Release 28 October 2013 ALROSA ANNOUNCES PRICING OF ITS OFFERING AT RUB35 PER ORDINARY SHARE Open Joint Stock Company “ALROSA” (“ALROSA” or the "Company"), the world’s largest diamond mining company based on rough diamond production volume, today announces the pricing of the offering (the “Offering”) of its existing shares. The Offering is in the form of ordinary shares (the “Shares”) that are 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 offer price has been set at RUB35 per Share. *The Offering comprises 1,181,332,741 Shares, or RUB41.3 billion, assuming no exercise of the repurchase option (as described below). *The offer price implies a market capitalisation for ALROSA of RUB257.7 billion. *The Offering comprises the sale of existing Shares by the following shareholders: *515,547,593 Shares, representing approximately 7 per cent of the Company’s share capital, will be sold by the Russian Federation under a framework established by decrees of the Russian Government dated 30 March 2013 and 26 October 2013; *515,547,593 Shares, representing approximately 7 per cent of the Company’s share capital, will be sold by OJSC RIC Plus, an open joint-stock company, wholly-owned by the Republic of Sakha (Yakutia); *150,237,555 Shares, representing approximately 2 per cent of the Company’s share capital, will be sold by Wargan Holdings Limited, a company organised under the laws of the Republic of Cyprus and controlled by ALROSA. *In connection with the Offering, VTB Capital plc, acting as a stabilising manager, may procure the purchase, for stabilisation purposes, of the Shares on MICEX SE or otherwise in a total number of up to 10 per cent of the number of the offer shares within 30 days from the date of this announcement. Sunland Holding SA, a wholly-owned subsidiary of ALROSA, has granted the stabilising manager an option to require Sunland Holding SA to purchase the Shares held by the stabilising manager as a result of stabilisation transactions in total number of up to 10 per cent of the number of the offer shares at the offer price. *The Company and Wargan Holdings Limited have each agreed in respect of themselves and its subsidiaries to a lock-up for a period of 180 days, subject to certain exceptions. In its letter of intent, the Ministry of Property and Land Relations of Yakutia has agreed in respect of itself and any authorised agencies or entities to a lock-up for a period of 180 days. According to the Russian Government decree dated 26 October 2013, a decision on further sale of Shares (other than the Shares to be sold by the Russian Federation in connection with the Offering) may be adopted by the Russian Federation no earlier than 180 days after the date of the decree. *The 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 arranger 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 plc 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 delighted with the international and domestic investors’ enthusiastic response to the Offering, which has marked an important strategic step for ALROSA. Our unique position as a global leader in rough diamond production with the world’s largest reserve base, favourable industry fundamentals, a successful sales and marketing strategy, strong cash flow generation, attractive future growth prospects and an experienced management team with a proven track record have all played their part in generating significant investor interest in ALROSA and the Offering. We will endeavour to further develop ALROSA as a public company and to increase value for all its shareholders.” About ALROSA ALROSA is the largest diamond mining company in the world based on rough diamond 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. The Company’s 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 prepared by Micon International, mineral industry consultants. In addition, ALROSA owns a 32.8 per cent interest 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. The Company’s 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. Under IFRS, ALROSA’s revenue was RUB 82,229 million in the six months ended 30 June 2013, RUB 76,529 million in the six months ended 30 June 2012 and RUB 150,880 million in 2012). Under IFRS, the Company’s profit amounted to RUB 14,616 million in the six months ended 30 June 2013, RUB 16,191 million in the six months ended 30 June 2012 and RUB 33,634 million in 2012. Following the Offering, Company’s largest shareholders include the Russian Federation that holds approximately 43.9 per cent interest and Yakutia holding approximately 25 per cent interest. 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 London Leonid Fink, Tony Friend, Galyna Kulachek, +44 207 457 2020 or Moscow Anton Karpov, +7 (495) 660 05 91 or ALROSA Media Centre +7 (495) 620 92 50, ext. 13-21 E-mail: email@example.com or ALROSA Investor Relations Centre +7 (495) 745 58 72 E-mail: IR@alrosa.ru
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ALROSA Announces Pricing of Its Offering at RUB35 Per Ordinary Share
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