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08/10/2012
13:36
M&A: FAS refused to satisfy Ural Mining and Metallurgical Company's application for acquisition of Revda Non-ferrous Metals Processing Works

The Federal Antimonopoly Service (FAS Russia) refused to satisfy the application of OJSC Uralskaya Gorno-Metallurgicheskaya Kompaniya (UGMK, Ural Mining and Metallurgical Company) for the acquisition of 100% of Shatravan Holding Limited (Cyprus) which owns OJSC Revda Non-ferrous Metals Processing Works, the regulatory body informed.

Analyzing the competitive environment in the markets of foil copper no more than 0.15 mm thick (excluding the base), copper plates, sheets and strips (or bands) more than 0.15 mm thick, copper rods and shapes, copper wire as well as copper pipes and tubes in the Russian Federation, Russia's Federal Antimonopoly service detected that the largest manufacturers of this range of products are CJSC Kolchugtsvetmet and CJSC Revda Non-ferrous Metals Processing Works belonging to the same group of persons as Ural Mining and Metallurgical Company. As a result of the transaction applied for, UGMK would increase its share in the markets of copper rods and shapes, copper wire as well as copper pipes and tubes to over 35%, its share in the markets of foil copper no more than 0.15 mm thick (excluding the base), copper plates, sheets and strips (or bands) more than 0.15 mm thick top over 50%.

Therefore, the transaction applied for, once approved and effected, would have result in fewer economic entities not belonging to the same group of persons, while UGMK's group of persons would increase its presence in the said markets in the Russian Federation, possibly resulting in the restriction of competition in the corresponding commodity markets, Russia's watchdog commented in its statement.

When approached for comment by the antimonopoly body, Russia's nonferrous mill products market players indicated the possible restriction of competition in the markets of foil copper no more than 0.15 mm thick (excluding the base), copper plates, sheets and strips (or bands) more than 0.15 mm thick, copper rods and shapes, copper wire as well as copper pipes and tubes in the Russian Federation resulting from the transaction applied for.

OJSC Uralskaya Gorno-Metallurgicheskaya Kompaniya (UGMK, English: Ural Mining and Metallurgical Company, tax number: 6606013640) unites assets of about 50 enterprises located in various regions of Russia. UGMK accounts for about 40% of the output of Russian cathode copper, zinc and about 50% of lead, a quarter of the domestic market of non-ferrous rolled products and more than a half of the European copper powder market. From year to year, UGMK increases the output and sale of almost all kinds of goods.

The shareholders of the company are: Cobargo Management Inc. (16.25%), Finmet Ag (Finmet Corp.) (19.99%), Diluk Associated S.A. (17.55%), Kaskonu Invest Corp. (16.2%), Fridingen Investments Limited (15.1%), Alpine Group Ag (15%).

The company was established in 1999 by Iskandar Makhmudov together with his partners. Its authorized capital (RUB 420 million) is represented by 420 million common shares at par value of 1 ruble.

According to the information and retrieval system DataCapital, net profit (RAS) of UGMK for 2011 grew 2.8-fold to RUB 8.936 billion from RUB 3.223 billion in 2010. Revenue increased by 1.3% to RUB 8.592 million from RUB 8.478 million, sales profit fell by 7.2% to RUB 5.534 million from RUB 5.962 million, pre-tax profit grew 2.8-fold to RUB 8.922 billion from RUB 3.217 billion.



"AK&M", 08.10.2012

 

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