OJSC Novolipetsk Steel (LSE: NLMK), the leading Russian steel producer, announces today that its 100% owned subsidiary, NLMK International BV (Netherlands), has signed an agreement to acquire a 100% stake in Novexco (Cyprus) Limited and 100% of Novex Trading (Swiss) S.A., both trading companies, from the United Steel Group (USG). The acquisition price is approximately Euro 77 million. The deal is subject to regulatory approval.

This transaction is in line with the Company’s strategy to establish an international trading department within the Group and is designed to better control the Company’s export sales and further enhance its presence in core export markets. 

In 2007, Novex Trading (Swiss) S.A. and Novexco (Cyprus) Limited acquired the trading business of Steelco Mediterranean Trading Ltd., Tuscany Intertrade (UK), and Moorfield Commodities Company, the international wholesale traders that were exclusive export traders of NLMK’s products for several years. The client base and all other business operations related to these trading companies were transferred to the acquirers.

Dmitry Baranov, Vice President for Sales, and a member of NLMK’s Management Board, commented: “This acquisition will enable us to better control our export sales to core markets, consolidate and control trading revenues as well as better service our customers and enhance the transparency of our export operations. We have long lasting relationships with the companies acquired, and we are sure that these companies will perfectly integrate into NLMK’s business model”.