By 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
TRANSPORTATION CONTRACTS
| The Company would like to provide updated information in relation to the transportation contracts. |
2014 TRANSPORTATION CONTRACTS
The Company announces that, during December 2013 and January 2014, a series of transportation contracts will be/were entered into between members of the Group and the associates of En+, pursuant to which the associates of En+ agreed to provide transportation services, including shipment, railway services, motor vehicles services and cargo transportation services, to members of the Group (the "2014 Transportation Contracts") with major terms set out below:
| Date of contract |
Customer (member |
Service provider |
Estimated | Payment terms |
Scheduled | |||||
| 27 December 2013 | LLC "IT-Service" | KraMZ-Auto | 100,817 | Payment to be made within 60 calendar days of receipt of the invoice, in cash via wire transfer | 31 December 2014 | |||||
| 1 January 2014 | RUSAL Sayanogorsk OJSC | OVE | 6,103,334 | Payment to be made within 10 days upon receipt of the invoice, in cash via wire transfer. | 31 December 2014 | |||||
| 1 January 2014 | RUSAL Bratsk Aluminium Smelter Open Joint Stock Company | KraMZ-Auto | 2,149,830 | Payment to be made within 10 banking days upon receipt of the invoice, in cash via wire transfer | 31 December 2014 | |||||
| 1 January 2014 | RUSAL Krasnoyarsk Aluminium Smelter Open Joint-Stock Company | KraMZ-Auto | 1,040,749 | Payment to be made within 10 calendar days upon receipt of the invoice, in cash via wire transfer | 31 December 2014 | |||||
| 1 January 2014 | RUSAL Krasnoyarsk Aluminium Smelter Open Joint-Stock Company | KraMZ-Auto | 3,849,843.37 | Payment to be made within 10 calendar days upon receipt of the invoice, in cash via wire transfer | 31 December 2014 | |||||
| 1 January 2014 | RUSAL Sayanogorsk Aluminum Smelter Open Joint-Stock Company | KraMZ-Auto | 337,944 | Payment to be made within 10 calendar days upon receipt of the invoice, in cash via wire transfer | 31 December 2014 | |||||
| 1 January 2014 | RUSAL Sayanogorsk Aluminium Smelter Open Joint-Stock Company | KraMZ-Auto | 322,518 | Payment to be made within 10 banking days upon receipt of the invoice, in cash via wire transfer | 31 December 2014 | |||||
| 1 January 2014 | RUSAL Sayanogorsk Aluminum Smelter Open Joint-Stock Company | KraMZ-Auto | 1,614,931 | Payment to be made within 10 banking days upon receipt of the invoice, in cash via wire transfer | 31 December 2014 | |||||
| 1 January 2014 | Sayanogorsky Vagonoremontniy Zavod Limited Liability Company | KraMZ-Auto | 21,900 | Payment to be made within 10 banking days upon receipt of the invoice, in cash via wire transfer | 31 December 2014 | |||||
| 1 January 2014 | Sayanogorsky Vagonoremontniy Zavod Limited Liability Company | KraMZ-Auto | 5,567 | Payment to be made within 10 calendar days upon receipt of the invoice, in cash via wire transfer | 31 December 2014 | |||||
| 1 January 2014 | RUSAL SAYANAL OJSC | KraMZ-Auto | 136,234 | Payment to be made within 15 days after the receipt of the VAT invoice, in cash via wire transfer | 31 December 2014. The contract will be renewed automatically but either party can choose not to renew the contract without prior consent of the other party one month before the expiry of the contract. | |||||
| 25 December 2013 | RUSAL SAYANAL OJSC | OVE | 69,609 | Payment to be made within 10 days after the receipt of the VAT invoice, in cash via wire transfer | 31 December 2014. The contract will be renewed automatically but either party can choose not to renew the contract without prior consent of the other party one month before the expiry of the contract. | |||||
| Total consideration payable for the year: | 15,753,276 | |||||||||
THE ANNUAL AGGREGATE TRANSACTION AMOUNT
Pursuant to Rule 14A.25 of the Listing Rules, the 2014 Transportation Contracts are required to be aggregated as they are each entered into by the Group with the associates of En+ and the subject matter of each contract relates to the provision of transportation services by the associates of En+ to the Group.
The annual aggregate transaction amount that is payable by the Group to the associates of En+ under the 2014 Transportation Contracts for the financial year ending 31 December 2014 is estimated to be up to approximately USD15.8 million. This annual aggregate transaction amount is estimated by the Directors based on the need for transportation services by the Group, the total contract price and the historical figures for the years ended 31 December 2011, 31 December 2012 and 31 December 2013.
REASONS FOR AND BENEFITS OF THE TRANSACTIONS
The 2014 Transportation Contracts are entered into for the purpose of renting vehicles and transporting the goods and cargoes of the Group. The Company considers that the transactions contemplated under the 2014 Transportation Contracts are for the benefit of the Company as the services provided are required in the production programmes of the Group.
The 2014 Transportation Contracts are on arm's length commercial terms. The consideration payable under the 2014 Transportation Contracts has been determined with reference to the market price and on terms no less favourable than those prevailing in the Russian market for transportation services of the same type and quality and those offered by KraMZ-Auto and OVE to independent third parties.
The Directors (including the independent non-executive Directors) consider that the 2014 Transportation Contracts are on normal commercial terms which are fair and reasonable and the transactions contemplated under the 2014 Transportation 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 by the 2014 Transportation Contracts save for Mr. Deripaska who is a director of En+ and is indirectly interested in more than 50% of the issued share capital of En+, and Mr. Vladislav Soloviev, Mr. Maxim Sokov, Ms. Olga Mashkovskaya and Ms. Gulzhan Moldazhanova, who are directors of En+. Accordingly, Mr. Deripaska, Mr. Vladislav Soloviev, Mr. Maxim Sokov, Ms. Olga Mashkovskaya and Ms. Gulzhan Moldazhanova did not vote on the Board resolutions for approving any of the 2014 Transportation Contracts.
LISTING RULES IMPLICATIONS
Each of OVE and KraMZ-Auto is an indirect subsidiary of En+, and is therefore an associate of En+ which is a substantial shareholder of the Company. Accordingly, each of OVE and KraMZ-Auto is a connected person of the Company under the Listing Rules.
Accordingly, the transactions contemplated under the 2014 Transportation Contracts constitute continuing connected transactions of the Company.
The annual aggregate transaction amount for the financial year ending 31 December 2014 of the continuing connected transactions under the 2014 Transportation Contracts is more than 0.1% but less than 5% under the applicable percentage ratios. Accordingly, pursuant to Rule 14A.34 of the Listing Rules, the transactions contemplated under the 2014 Transportation Contracts are only subject to the reporting and announcement requirements set out in Rules 14A.45 to 14A.47, the annual review requirements set out in Rules 14A.37 to 14A.40 and the requirements set out in Rules 14A.35(1) and 14A.35(2) of the Listing Rules. These transactions are exempt from the independent shareholders' approval requirements under Chapter 14A of the Listing Rules.
Information on the 2014 Transportation Contracts will be included in the next annual report and accounts of the Company in accordance with Rule 14A.46 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. Spread across 19 countries in 5 continents, the operations and offices of the Company employ over 69,000 people.
KraMZ-Auto is principally engaged in the provision of transportation services.
OVE is principally engaged in the provision of transportation services and railway transport.
DEFINITIONS
In this announcement, the following expressions have the following meanings, unless the context otherwise requires:
| "associate" | has the same meaning ascribed to it 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 to it under the Listing Rules. | |
| "continuing connected transaction(s)" | has the same meaning ascribed to it 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. | |
| KraMZ-Auto | KraMZ-Auto Limited Liability Company, an indirect subsidiary of En+. | |
| "Listing Rules" | The Rules Governing the Listing of Securities on the Stock Exchange. | |
| "Mr. Deripaska" | Mr. Oleg Deripaska, the chief executive officer and an executive Director of the Company. | |
| "OVE" | OJSC Otdeleniye Vremennoy Expluatatsii, an indirect subsidiary of En+. | |
| "percentage ratios" | the percentage ratios under Rule 14.07 of the Listing Rules. | |
| "Stock Exchange" | The Stock Exchange of Hong Kong Limited. | |
| "subsidiary" | has the same meaning ascribed to it under the Listing Rules. | |
| "substantial shareholder" | has the same meaning ascribed to it under the Listing Rules. | |
| "USD" | United States dollars, the lawful currency of the United States of America. | |
By Order of the Board of Directors of |
2 January 2014
As at the date of this announcement, the executive Directors are Mr. Oleg Deripaska, Ms. Vera Kurochkina, Mr. Maxim Sokov, Mr. Vladislav Soloviev and Mr. Stalbek Mishakov, the non-executive Directors are Mr. Dmitry Afanasiev, Mr. Len Blavatnik, Mr. Ivan Glasenberg, Mr. Maksim Goldman, Ms. Gulzhan Moldazhanova, Mr. Christophe Charlier, 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
