Shareholders of OJSC Severalmaz Approved Acquisition of 100% Share in Nizhne-Lenskoye

Shareholders of OJSC Severalmaz have recently approved potential transaction on acquisition of 100% share in OJSC Nizhne-Lenskoye from Ministry of Property and Land Relations of Republic Sakha (Yakutia), RIA Novosti reported citing the company’s statement.
Previously, at the beginning of September, Federal Antimonopoly Service (FAS) granted requests of two subsidiaries of AK ALROSA, namely OJSC Almazy Anabara And OJSC Severalmaz, related to acquisition of shares in Severalmaz and then issued an appropriate instruction.
FAS determined that following the results of potential transaction the aggregate share of the above group of entities at the Russian diamond market will exceed 99%. Therefore the companies shall follow procedures aimed at maintaining competition at the Russian rough diamond market and prevention of monopolistic activities.
In particular, ALROSA shall undertake to comply with existing short-term and/or long-term contracts on distribution of rough diamonds produced by Nizhne-Lenskoye. In addition to that, following closure of the deal ALROSA will be obliged to pursue operation of the company subject to a number of rules and procedures developed by FAS.
The above instruction by FAS is valid during the whole period when ALROSA, Nizhne-Lenskoye and Almazy Anabara are affiliated in one group, according to the statement.
Nizhne-Lenskoye is involved in diamond mining in Yakutia and accounts for about 4% of the total Russia’s diamond output. Previously Yakut government used to announce its plans to privatize the company.
ALROSA’s representative spoke to Prime reporter and noted that the interest in Nizhne-Lenskoye was associated primarily with the need to expand resource base of ALROSA. Due to this fact the two subsidiaries of ALROSA filed necessary documents to FAS in advance, in order to be prepared to participate in the asset sale.