Apr 22 2008
Evraz Group S.A. announces that Highveld Steel and Vanadium Corporation , which is Evraz’s subsidiary, has entered into definitive agreements with Vanchem Vanadium Products (Proprietary) Limited (“VVP”), a special purpose company controlled by Duferco Investment Partners Inc, on the disposal by Highveld of certain vertically integrated vanadium assets.
In 2007, Evraz committed to procure the disposal as a condition to the approval by the European Commission and South African competition authorities of its acquisition of a majority interest in Highveld.
Under the agreements, Highveld will dispose of:
a) Class “A” ordinary shares in the issued share capital of Mapochs Mine (Proprietary) Limited, a special purpose company that has been incorporated by Highveld for purposes of acquiring and holding the Corporation’s Mapochs Mine. The rights attached to the Class “A” ordinary shares are limited to rights required to enable VVP to protect its rights under the fines ore supply agreement;
b) the Corporation’s Vanchem operations; and
c) the Corporation’s 50% shareholding in South Africa Japan Vanadium (Proprietary) Limited.
In addition, Highveld has entered into supply agreements with VVP for the supply of certain volume of fines ore from the Mapochs Mine, which cannot be used by Highveld in its steelworks, and for the supply of certain volumes of vanadium-bearing slag, which is produced by Highveld as a by-product of steel, both at market-related prices.
Highveld has agreed to sell the above three assets for an aggregate consideration of US$160 million, which will be discharged by the immediate payment of US$100 million in cash, and by the buyer’s commitment to undertake specific environmental projects in relation to Vanchem.
The implementation of the disposal is subject to certain conditions, including approvals of the European Commission, South African competition authorities and the JSE Limited.
Posted April 22nd,2008