Mechel acquired the shares from Russian utility RAO UES for approximately $44 million (RUR1.14 billion). The move is in line with Mechel’s strategy of expanding its presence in the Russian power sector, the company said.
According to Mechel, Kuzbass Power Sales is the largest power distributing company in Siberia, with a planned distributed power volume of 24.8 billion kWh for 2007.
Mechel has been developing its power business to include additional markets for steam coal and to produce higher value added products, such as electric and heat energy. The company is also aiming to provide its mining and metal segments with their own energy resources.
The acquisition of Kuzbass Power Sales Company enables us to form a vertically integrated power company with its own power generating facilities (Southern Kuzbass Power Plant), raw material resources (Southern Kuzbass), and now a well established client base, said Mechel’s COO Alexey Ivanushkin.
Mechel acquired Southern Kuzbass Power Plant in March 2007, as part of its strategy of enhancing its power sector presence.
