Regulatory News:
United Company RUSAL Plc (Paris:RUSAL) (Paris:RUAL):
Pursuant to Chapter 38 of the Rules Governing the Listing of
Securities on The Stock Exchange of Hong Kong Limited, the
Securities and Futures Commission regulates United Company RUSAL
Plc in relation to the listing of its shares on The Stock Exchange
of Hong Kong Limited. The Securities and Futures Commission takes
no responsibility for the contents of this announcement, makes no
representation as to its accuracy or completeness and expressly
disclaims any liability whatsoever for any loss howsoever arising
from or in reliance upon the whole or any part of the contents of
this announcement.
UNITED COMPANY RUSAL PLC(Incorporated
under the laws of Jersey with limited liability)(Stock Code:
486)
CONTINUING CONNECTED TRANSACTIONSSALE
OF RAW MATERIALS
The Company announces that a member of the Group, as seller,
has entered into the 2015 Raw Materials Supply Contracts with the
associates of Mr. Deripaska/En+, as buyers.
2015 RAW MATERIALS SUPPLY CONTRACTS
The Company announces that RUSAL Achinsk OJSC (“RUSAL
Achinsk”), a member of the Group, as seller, has entered into
the following raw materials supply contracts with the associates of
Mr. Deripaska/En+, as buyers, with particulars set out below (the
“2015 Raw Materials Supply Contracts”):
No. Date of contract Seller
Buyer
(an associate of
Mr. Deripaska/En+)
Raw materials to be supplied Estimated
delivery volume for the year ending
31 December 2015
Estimated consideration payable for the year ending
31 December 2015, excluding VAT
(USD)
Payment terms 1. 22 December 2014 RUSAL
Achinsk Achinsk Cement LLC Limestone 925,683
tons 5,666,484 100% pre-payment 2. 22 December
2014 RUSAL Achinsk Achinsk Cement LLC
Nepheline mud 606,150 tons 2,123,232 100%
pre-payment 3. 22 December 2014 RUSAL Achinsk
Achinsk Cement LLC Clay from overburden 93,931 tons
115,892 100% pre-payment 4. 22 December 2014
RUSAL Achinsk Achinsk Cement LLC Pulverized
coal fuel 12,000 tons 888,919 100% pre-payment
5. 22 December 2014 RUSAL Achinsk Achinsk
Cement LLC Coal 211,343 tons 11,783,057
100% pre-payment 6. 22 December 2014 RUSAL Achinsk
Achinsk Cement LLC Fuel oil 3,650 tons
1,549,301 100% pre-payment 7. 22 December 2014
RUSAL Achinsk Achinsk Cement LLC Diesel fuel
7.2 tons 8,012 100% pre-payment 8. 22 December
2014 RUSAL Achinsk KraMZ-Auto Limited Liability
Company (“
KraMZ-Auto LLC”) Diesel fuel 120
tons 125,276 100% pre-payment Total
estimated consideration payable for the year:
22,260,173
For each of the contracts set out in the table above, the
consideration is to be satisfied in cash via wire transfer. For
each of the contracts no. 1 to no. 8 above, the scheduled
termination date is 31 December 2015 and each of the contracts is
renewable upon agreement of both parties.
THE AGGREGATION APPROACH
Pursuant to Rule 14A.81 of the Listing Rules, the continuing
connected transactions under the 2015 Raw Materials Supply
Contracts are required to be aggregated together, as they were
entered into by the Group with the associates of the same connected
persons or with parties connected or otherwise associated with one
another, and the subject matter of each of the contracts relates to
the supply of raw materials by the Group.
The annual aggregate transaction amount payable under the 2015
Raw Materials Supply Contracts is estimated to be approximately
USD22.26 million for the year ending 31 December 2015.
The consideration payable under the 2015 Raw Materials Supply
Contracts is calculated by multiplying the unit price by the
volume. The unit price of the relevant raw materials are set out
below (adopting the same numberings in the table which sets out the
major terms of the 2015 Raw Materials Supply Contracts), which is
based on the total production cost or original purchase price plus
gross margin where applicable.
No. Raw materials Approximate unit
price 1. Limestone Up to USD6.12 per ton
(inclusive of 23.12% gross margin)
2. Nepheline mud Up to USD3.51 per ton
(inclusive of 2.25% gross margin)
3. Clay from overburden Up to USD1.23 per ton 4.
Pulverized coal fuel Up to USD74.08 per ton
(inclusive of 11.67% gross margin)
5. Coal Up to USD55.82 per ton
(inclusive of 10% gross margin)
6. Fuel oil Up to USD424.47 per ton
(inclusive of 10% gross margin)
7. Diesel fuel Up to USD1,112.76 per ton
(inclusive of 10% gross margin)
8. Diesel fuel Up to USD1,043.97 per ton
(inclusive of 3.2% gross margin)
The consideration payable under the under the 2015 Raw Materials
Supply Contracts has been arrived at after arm’s length negotiation
by reference to market price and on terms no less favourable than
those prevailing in the Russian market for raw materials of the
same type and quality and those offered by members of the Group to
independent third parties customers. The annual aggregate amount is
the maximum amount of consideration payable under the terms of the
2015 Raw Materials Supply Contracts based on the delivery volume
for the year ending 31 December 2015 estimated by Directors and the
demand from the buyers.
REASONS FOR AND BENEFITS OF THE TRANSACTIONS
The Directors consider that the entering into of the 2015 Raw
Materials Supply Contracts is for the benefit of the Company as the
sale is profitable and the Group is assured of payment on a timely
basis and there are less financial risks. As to contract no. 3,
Achinsk Cement LLC is the only buyer for the clay from overburden
in the relevant region.
The Directors (including the independent non-executive
Directors) consider that the 2015 Raw Materials Supply Contracts
have been negotiated on an arm’s length basis and on normal
commercial terms which are fair and reasonable and the transactions
contemplated thereunder are in the ordinary and usual course of
business of the Group and in the interests of the Company and its
shareholders as a whole.
None of the Directors has a material interest in the
transactions contemplated under the 2015 Raw Materials Supply
Contracts, save for:
(i) (a) Mr. Deripaska, who is a director of
Basic Element and is interested in more than 50% of the issued
share capital of Basic Element; (b) Ms. Gulzhan Moldazhanova, who
is a director of Basic Element; and (c) Ms. Olga Mashkovskaya, who
is a deputy chief executive officer for finance of Basic Element.
Basic Element is the holding company of Achinsk Cement LLC.
Accordingly, Mr. Deripaska, Ms. Gulzhan Moldazhanova and Ms. Olga
Mashkovskaya did not vote on the Board resolutions approving the
raw materials supply contracts with Achinsk Cement LLC;
(ii) Mr. Deripaska, Mr. Vladislav Soloviev,
Mr. Maxim Sokov, Ms. Olga Mashkovskaya and Ms. Gulzhan Moldazhanova
who are directors of En+, being the holding company of KraMZ-Auto
LLC. Mr. Deripaska is also indirectly interested in more than 30%
of the issued share capital of KraMZ-Auto LLC. Accordingly, Mr.
Deripaska, Mr. Vladislav Soloviev, Mr. Maxim Sokov, Ms. Olga
Mashkovskaya and Ms. Gulzhan Moldazhanova did not vote on the Board
resolutions approving the raw materials supply contract with
KraMZ-Auto LLC.
LISTING RULES IMPLICATIONS
Achinsk Cement LLC is held by Basic Element as to more than 30%
of the issued share capital. Basic Element is in turn held by Mr.
Deripaska (an executive Director) as to more than 50% of the issued
share capital. Achinsk Cement LLC is therefore an associate of Mr.
Deripaska and is thus a connected person of the Company.
KraMZ-Auto LLC is held by En+ (a substantial shareholder of the
Company) as to more than 30% of the issued share capital. En+ is in
turn held by Mr. Deripaska as to more than 50% of the issued share
capital. KraMZ-Auto LLC is therefore an associate of Mr. Deripaska
and of En+, and is thus a connected person of the Company.
Accordingly, the transactions contemplated under the 2015 Raw
Materials Supply Contracts constitute continuing connected
transactions of the Company.
The estimated annual aggregate transaction amount for the
financial year ending 31 December 2015 of the continuing connected
transactions under the 2015 Raw Materials Supply Contracts is more
than 0.1% but less than 5% under the applicable percentage ratios.
Accordingly, pursuant to Rule 14A.76 of the Listing Rules, the
transactions contemplated under these contracts are only subject to
the announcement requirements set out in Rules 14A.35 and 14A.68,
the annual review requirements set out in Rules 14A.49, 14A.55 to
14A.59, 14A.71 and 14A.72 and the requirements set out in Rules
14A.34 and 14A.50 to 14A.54 of the Listing Rules. These
transactions are exempt from the circular and shareholders’
approval requirements under Chapter 14A of the Listing Rules.
Details of the 2015 Raw Materials Supply Contracts will be
included in the next annual report and accounts of the Company in
accordance with Rule 14A.71 of the Listing Rules where
appropriate.
PRINCIPAL BUSINESS ACTIVITIES
The Company is principally engaged in the production of
aluminium and alumina. The Company’s assets include bauxite and
nepheline ore mines, alumina refineries, aluminium smelters,
casthouse business for alloys production, aluminium foil mills and
production of aluminium packaging materials as well as
power-generating assets.
Achinsk Cement LLC is principally engaged in the production of
cement.
KraMZ-Auto LLC is principally engaged in the provision of
transportation services.
DEFINITIONS
In this announcement, the following expressions have the
following meanings, unless the context otherwise requires:
“associate” has the same meaning ascribed thereto under the
Listing Rules “Basic Element” Basic Element Limited, a company
incorporated in Jersey “Board” the board of Directors of the
Company “Company” United Company RUSAL Plc, a limited liability
company incorporated in Jersey, the shares of which are listed on
the main board of the Stock Exchange “connected person” has the
same meaning ascribed thereto under the Listing Rules “continuing
connected transaction(s)” has the same meaning ascribed thereto
under the Listing Rules “Director(s)” the director(s) of the
Company “En+” En+ Group Limited, a company incorporated in Jersey,
a substantial shareholder (as defined in the Listing Rules) of the
Company “Group” the Company and its subsidiaries “Listing Rules”
The Rules Governing the Listing of Securities on the Stock Exchange
“Mr. Deripaska” Mr. Oleg Deripaska, an executive Director
“percentage ratios” the percentage ratios under Rule 14.07 of the
Listing Rules “Stock Exchange” The Stock Exchange of Hong Kong
Limited “substantial shareholder” has the same meaning ascribed
thereto under the Listing Rules “USD” United States dollars, the
lawful currency of the United States of America “VAT” Value added
tax By Order of the Board of Directors of
United Company RUSAL
PlcAby Wong Po YingCompany Secretary
23 December 2014
As at the date of this announcement, the executive Directors are
Mr. Oleg Deripaska, Ms. Vera Kurochkina, Mr. Vladislav Soloviev and
Mr. Stalbek Mishakov, the non-executive Directors are Mr. Maxim
Sokov, Mr. Dmitry Afanasiev, Mr. Len Blavatnik, Mr. Ivan
Glasenberg, Mr. Maksim Goldman, Ms. Gulzhan Moldazhanova, Mr.
Daniel Lesin Wolfe, Ms. Olga Mashkovskaya and Ms. Ekaterina
Nikitina, and the independent non-executive Directors are Mr.
Matthias Warnig (Chairman), Dr. Peter Nigel Kenny, Mr. Philip
Lader, Ms. Elsie Leung Oi-sie and Mr. Mark Garber.
All announcements and press releases published by the Company
are available on its website under the links
http://www.rusal.ru/en/investors/info.aspx and
http://www.rusal.ru/en/press-center/press-releases.aspx,
respectively.
United Company RUSAL Plc