Regulatory News:
United Company RUSAL Plc (Paris:RUSAL) (Paris:RUAL):
Hong Kong Exchanges and Clearing Limited and The Stock Exchange
of Hong Kong Limited take no responsibility for the contents of
this announcement, make no representation as to its accuracy or
completeness and expressly disclaim 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
TRANSACTIONSPURCHASE OF RAW MATERIALS FOR REPAIRING
Reference is made to the announcements of
the Company dated 22 December 2015, 28 February 2017, 22 June 2017,
4 July 2017 and 30 August 2017 in relation to continuing connected
transactions regarding the purchase of raw materials for repairing.
The Company announces that on 15 September 2017, a member of the
Group, as buyer, and an associate of Mr. Blavatnik, as supplier,
entered into the New Purchase of Raw Materials for Repairing
Contract.
THE NEW PURCHASE OF RAW MATERIALS FOR REPAIRING
CONTRACT
Reference is made to the announcements of the Company dated 22
December 2015, 28 February 2017, 22 June 2017, 4 July 2017 and 30
August 2017 in relation to continuing connected transactions
regarding the purchase of raw materials for repairing.
The Company announces that, on 15 September 2017, a member of
the Group, as buyer, and an associate of Mr. Blavatnik, as
supplier, entered into the additional agreement pursuant to which
the buyer agreed to buy and the supplier agreed to sell raw
materials for repairing (the “New Purchase of Raw Materials for
Repairing Contract”). The key terms of the New Purchase of Raw
Materials for Repairing Contract are set out below:
Date of contract
Buyer(member ofthe
Group)
Seller (an associateof Mr.
Blavatnik)
Rawmaterials to
bepurchased
Estimatedpurchasevolume
Unit price(Net of VAT)
Estimatedconsiderationpayableexcluding
VAT(USD)
Scheduledterminationdate
Paymentterms
15 September 2017, which is
anadditionalagreement to theoriginal contractdated 21
December2015
LimitedLiabilityCompany“RussianEngineeringCompany”
Closed Joint
StockCompany“ENERGOPROM-Novosibirsk ElectrodePlant”
Cathodeblocks
2,008
tons(including10%additionaloptionalvolume)
up to 1,512tons (+10/-5%)at a price up
toUSD1,540 per 1 ton netof VAT
up to 222 tons(+10/-5%) for the priceup to
USD1,011 per1 ton net of VAT
up to 91 tons(+10/-5%) for the priceup to
USD1,001per 1 ton net of VAT
2,908,414(including consideration forthe
10% additionaloptional volume) (Note 1)
31 December2017
Payment isdue within45 calendardays upon
dispatch
Total
estimatedconsiderationpayable for theyear
ending31 December 2017
2,908,414
Note:
1. The consideration is to be satisfied using promissory notes
of the Company or through offset of counter-claims. The price is
fixed in US dollars. When issuing and processing invoices, the
price will be recalculated in Russian roubles according to the
following rules:
- If the US dollar exchange rate as reported by the Central Bank
of the Russian Federation (“CB RF”) on the date of shipment is
within the average quarterly rate of CB RF for the 4th quarter 2016
(hereinafter referred to as AQR-CB) per one US dollar +/- 20%, the
price in roubles is determined at the rate of CB RF on the date of
shipment
- If the exchange rate of CB RF is > (AQR-CB plus 20%) per one
US dollar on the date of shipment, the price of the goods in
roubles is calculated as: 32.5% of the price in US dollars at a
fixed exchange rate (AQR-CB plus 20%) per one US dollar, plus 67.5%
of the price in US dollars at the exchange rate of the CB RF on the
date of shipment
- If the exchange rate of CB RF is < (AQR-CB minus 20%) per
one US dollar on the date of shipment, the price in roubles is
calculated as: 32.5% of the price in US dollars at a fixed exchange
rate (AQR-CB minus 20%) per one US dollar, plus 67.5% of the price
in US dollars at the exchange rate of CB RF on the date of
shipment
THE ANNUAL AGGREGATE TRANSACTION AMOUNT
Pursuant to Rule 14A.81 of the Listing Rules, the continuing
connected transactions contemplated under the New Purchase of Raw
Materials for Repairing Contract and the Previously Disclosed
Purchase of Raw Materials for Repairing Contracts should be
aggregated, as they were entered into by members of the Group with
the associates of Mr. Blavatnik, and the subject matter of each
contract relates to the purchase of raw materials from the
associates of Mr. Blavatnik by the Group.
The annual aggregate transaction amount that is payable by the
Group to the associates of Mr. Blavatnik under the New Purchase of
Raw Materials for Repairing Contract and the Previously Disclosed
Purchase of Raw Materials for Repairing Contracts for the financial
year ending 31 December 2017 is estimated to be approximately
USD35.07 million.
The contract price payable under the New Purchase of Raw
Materials for Repairing Contract has been determined with reference
to the 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 the associate of Mr. Blavatnik to
independent third parties.
In accordance with the Company’s procurement policies and using
tools such as the Company’s procurement portal, the Company invited
several organizations to take part in the tender in relation to the
relevant required purchase of raw materials. The Company’s
procurement managers, in line with the best-in-class experience and
know-how of the Company’s procurement policies, with approval from
the Company’s bidding committee, chose the contractor offering the
best terms and conditions (taking into account the quality offered,
payment terms and the price) and then entered into the contract
with the chosen party. Accordingly, the New Purchase of Raw
Materials for Repairing Contract was entered into.
The annual aggregate transaction amount is estimated by the
Directors based on the amount of raw materials to be purchased and
their contract price.
REASONS FOR AND BENEFITS OF THE TRANSACTIONS
The Directors consider that the New Purchase of Raw Materials
for Repairing Contract is for the benefit of the Company, as the
chosen contractor can supply raw materials to the Group at a
satisfactory quality and at a competitive price. The New Purchase
of Raw Materials for Repairing Contract was entered into for the
purposes of purchasing raw materials for repair work.
The Directors (including the independent non-executive
Directors) consider that the New Purchase of Raw Materials for
Repairing Contract has been negotiated on an arm’s length basis and
on normal commercial terms which are fair and reasonable and the
transactions contemplated under the New Purchase of Raw Materials
for Repairing Contract 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 by the New Purchase of Raw Materials for
Repairing Contract save for Mr. Blavatnik, a former non-executive
Director, who is indirectly interested in more than 30% of Closed
Joint Stock Company “ENERGOPROM-Novosibirsk Electrode Plant”.
LISTING RULES IMPLICATIONS
Mr. Blavatnik, a former non-executive Director, indirectly holds
more than 30% of the issued share capital of Closed Joint Stock
Company “ENERGOPROM-Novosibirsk Electrode Plant”. Closed Joint
Stock Company “ENERGOPROM-Novosibirsk Electrode Plant” is therefore
an associate of Mr. Blavatnik and a connected person of the Company
under the Listing Rules.
Accordingly, the transactions contemplated under the New
Purchase of Raw Materials for Repairing Contract and the Previously
Disclosed Purchase of Raw Materials for Repairing Contracts
constitute continuing connected transactions of the Company.
The estimated annual aggregate transaction amount of the
continuing connected transactions under the New Purchase of Raw
Materials for Repairing Contract and the Previously Disclosed
Purchase of Raw Materials for Repairing Contracts for the financial
year ending 31 December 2017 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 New Purchase of Raw Materials for Repairing
Contract and the Previously Disclosed Purchase of Raw Materials for
Repairing Contracts will be included in the relevant 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 and sale of
aluminium, including alloys and value-added products, and
alumina.
Closed Joint Stock Company “ENERGOPROM-Novosibirsk Electrode
Plant” is principally engaged in the production of graphite
electrodes, carbon electrodes, cathode blocks, calcined petroleum
coke and electrode paste.
DEFINITIONS
In this announcement, the following expressions have the
following meanings, unless the context otherwise requires:
“associate(s)” has the same meaning ascribed
thereto under the Listing Rules. “Board” the board of
Directors. “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 of Hong Kong
Limited.
“connected person(s)” has the same meaning ascribed thereto
under the Listing Rules. “continuing connected transactions”
has the same meaning ascribed thereto under the Listing Rules.
“Director(s)” the director(s) of the Company. “Group”
the Company and its subsidiaries. “Listing Rules” the Rules
Governing the Listing of Securities on the Stock Exchange of Hong
Kong Limited. “Mr. Blavatnik” Mr. Len Blavatnik, a former
non-executive Director. “percentage ratios” the percentage
ratios under Rule 14.07 of the Listing Rules.
“Previously Disclosed Purchase of Raw
Materialsfor Repairing Contracts”
the agreements between members of the
Group and the associates of Mr. Blavatnik,pursuant to which the
associates of Mr. Blavatnik agreed to supply raw materialsto
members of the Group in 2017, as disclosed in the announcements of
the Companydated 22 December 2015, 28 February 2017, 22 June 2017,
4 July 2017 and 30 August 2017.
“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
18 September 2017
As at the date of this announcement, the executive Directors are
Mr. Oleg Deripaska, Mr. Vladislav Soloviev and Mr. Siegfried Wolf,
the non-executive Directors are Mr. Maxim Sokov, Mr. Dmitry
Afanasiev, Mr. Ivan Glasenberg, Mr. Maksim Goldman, Ms. Gulzhan
Moldazhanova, Mr. Daniel Lesin Wolfe, Ms. Olga Mashkovskaya, Ms.
Ekaterina Nikitina and Mr. Marco Musetti, and the independent
non-executive Directors are Mr. Matthias Warnig (Chairman), Mr.
Philip Lader, Dr. Elsie Leung Oi-sie, Mr. Mark Garber, Mr. Dmitry
Vasiliev and Mr. Bernard Zonneveld.
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,
http://rusal.ru/investors/info/moex/ and
http://www.rusal.ru/en/press-center/press-releases.aspx,
respectively.
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United Company RUSAL Plc