Mechel completes acquisition
Mechel completed the acquisition of Donetsk Electrometallurgical Plant which was approved at Mechel OAO’s annual shareholders’ meeting and by the Mechel’s board of directors. The acquisition is valued at $537 million.
Payment for DEMZ AO’s shares will be made in installments over seven years.
At the time of Mechel’s annual shareholders’ meeting, payment was expected to be paid in installments over four years, but over the course of completing the acquisition, the term was extended by three years without increasing the total consideration.
The plant’s electric furnace smelting facilities are currently working at their full capacity, producing up to 90,000 tons of steel per month. In 2011, steel production is expected to total over 1 million tons.
Production of hot-rolled products is planned this year to top 145,000 tons.