NMK Acquires Majority Share in Coal Company

OJSC "Magnitogorsk Iron and Steel Works" (MMK) announces that it has closed the transaction to get effective control over 82.6% of OJSC "Belon" (Belon) - one of the leading coal concentrate producers in Russia.

At the final stage of the transaction MMK increased its stake in Onarbay Enterprises Ltd, which owns 82.6% of the Russian coal-producing company Belon, from 50% to 100%.

Key transaction highlights:

• MMK obtains control over Belon, increasing its stake in the company to 82.6%
• The transaction secures stable coking coal supplies to MMK for its steel smelting operations, including supplies of deficit coal grades
• The acquisition will allow to continue implementing the investment programme of Belon
• Supplies from Belon will account for the bulk of MMK requirement of coking coal concentrate

Victor Rashnikov, Chairman of the MMK Board of Directors, stated: "This transaction brings MMK self-efficiency in strategically important input material to a new level. We are sure that this acquisition will strengthen our competitiveness in the current situation and in the long-term prospect".