HONG KONG--(BUSINESS WIRE)--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 TRANSACTIONS
|The Company announces that members of the Group entered into contracts with the associates of En+, pursuant to which the associates of En+ agreed to provide repair services to members of the Group.|
THE REPAIR SERVICES CONTRACTS
The Company announces that members of the Group, entered into contracts with the associates of En+, pursuant to which the associates of En+ agreed to provide repair services to members of the Group (the “Repair Services Contracts”), details of which are set out below.
|No.||Date of contract||Customer (member of the Group)||
|Term of contract||Repair services||Estimated consideration payable for the year ending 31 December 2016, excluding VAT (USD)||Payment terms|
|1||29 December 2015||RUSAL Achinsk||Bratskenergoremont||Up to 30 June 2016||Restoration of technical parameters of turbine and maintenance of generator||518,753||Payment to be made within 45 calendar days after signing work acceptance certificates|
|2||29 December 2015||RUSAL Achinsk||Bratskenergoremont||Up to 31 December 2016, may be extended by both parties signing an addendum||Maintenance of the CHP equipment||6,154,164||—a 50% prepayment of the cost of the montly services to be made within 5 banking days —50% payment to be made within 10 banking days after receiving a tax invoice|
|3||28 December 2015||RUSAL Bratsk Aluminium Smelter OJSC||KraMZ-Auto||Up to 31 December 2016||Motor vehicle maintenance and repair||4,656||Within 10 banking days upon receiving of the original proforma invoice issued under the service acceptance certificate signed by the parties|
|Total estimated consideration for the year:||6,677,573|
THE ANNUAL AGGREGATE TRANSACTION AMOUNT
The contract price payable under the Repair Services Contracts has been determined with reference to the market price and on terms no less favourable than those prevailing in the Russian market for repair services of the same type and quality and those offered by the associates of En+ to independent third parties. The basis of calculation of payments under the Repair Services Contracts is the price of contracts offered by the associates of En+ which is based on the estimated cost (including labour cost and the necessary materials) for the relevant repair works. The Company invited several organizations to take part in the tender in relation to the relevant required repair services and chose the contractors offering the best terms and conditions (taking into account the price and quality offered by those contractors) and then entered into contracts with the chosen contractors.
Based on the terms of the Repair Services Contracts and the Previously Disclosed Repair Services Contract, the annual aggregate transaction amount that is payable by the Group to the associates of En+ for the financial year ending 31 December 2016 is estimated to be approximately USD6.69 million.
The annual aggregate transaction amount is estimated by the Directors based on the amount of repair services to be received and their contract price.
THE AGGREGATION APPROACH
Pursuant to Rule 14A.81 of the Listing Rules, the continuing connected transactions contemplated under the Repair Services Contracts and the Previously Disclosed Repair Services Contract should be aggregated, as they were entered into by the Group with the associates of the same group of connected persons who are parties connected or otherwise associated with one another, and the subject matter of each of the contracts relates to the receipt of repair and maintenance services by members of the Group.
REASONS FOR AND BENEFITS OF THE TRANSACTIONS
The Directors consider that the Repair Services Contracts are for the benefit of the Company, as the contractors offered a competitive price.
The Directors (including the independent non-executive Directors) consider that the Repair Services Contracts have been negotiated on an arm’s length basis and on normal commercial terms which are fair and reasonable and the transactions contemplated under the Repair Services Contracts 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 Repair Services Contracts, save for Mr. Deripaska, Mr. Maxim Sokov, Ms. Olga Mashkovskaya and Ms. Gulzhan Moldazhanova, who are directors of En+, being the holding company of Bratskenergoremont. Mr. Deripaska is also indirectly interested in more than 50% of the issued share capital of En+. Accordingly, Mr. Deripaska, Mr. Maxim Sokov, Ms. Olga Mashkovskaya and Ms. Gulzhan Moldazhanova did not vote on the Board resolution approving the Repair Services Contracts.
LISTING RULES IMPLICATIONS
Each of Bratskenergoremont and KraMZ-Auto is directly or indirectly held by En+ as to more than 30% of the issued share capital and is therefore an associate of En+ which is a substantial shareholder of the Company and thus is a connected person of the Company under the Listing Rules.
The estimated annual aggregate transaction amount of the continuing connected transactions under the Repair Services Contracts and the Previously Disclosed Repair Services Contract for the financial year ending 31 December 2016 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 the independent shareholders’ approval requirements under Chapter 14A of the Listing Rules.
Details of the Repair Services Contracts and the Previously Disclosed Repair Services Contract 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.
Bratskenergoremont is principally engaged in activities for supporting of operability of the equipment, production of electric installation, all-construction works and others.
KraMZ-Auto is principally engaged in the provision of transportation services.
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.|
|“connected person”||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.|
|“En+”||En+ Group Limited, a company incorporated in Jersey, a substantial shareholder 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.|
|“Previously Disclosed Repair Services Contract”||the repair services contract between a member of the Group and an associate of En+, pursuant to which the associate of En+ agreed to provide repair services to member of the Group during the year 2016, as disclosed in the announcement of the Company dated 2 July 2015.|
|“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 Plc
Aby Wong Po Ying
30 December 2015
As at the date of this announcement, the executive Directors are Mr. Oleg Deripaska, 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, Mr. Mark Garber and Mr. Dmitry Vasiliev.
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.