Ministry of Property and Land Relations of Republic Sakha (Yakutia) announced an auction on disposal of registered ordinary shares in OJSC Nizhne-Lenskoye. A total of 25,901,806 units, equivalent of 51% of the company’s share capital, to be put on sale, yktimes.ru reported.
Starting price for the shares is set at RUB 3,500,000,000. Applications for participation in the auction are to be filed till December 4, 2012, while the auction will be closed on December 8, 2012.
Based on the valuation stipulated in documentation for the auction, Yakut ministry values the company at RUB 7 billion in the whole. Meanwhile, as of September, 2012, total debt of OJSC Nizhne-Lenskoye reached RUB 8.2 billion.
AK ALROSA is seen as the main candidate for purchase of the company. Two of its subsidiaries – OJSC Almazy Anabara and OJSC Severalmaz - had got approval of Federal Antimonopoly Service for acquisition of 100% share in OJSC Nizhne-Lenskoye, while the financing limit of Severalmaz allocated for this purchase, set by ALROSA does not exceed RUB 7 billion.
“We expect positive impact of this transaction of ALROSA,” – the company’s experts commented. “Given the effect of production, investment and distribution resources provided by ALROSA, Nizhne-Lenskoye is set to increase profit margin and secure an additional cash flow.”
On the other hand, some experts note that this acquisition might become a headache for ALROSA. The reason is that ALROSA pursues the purchase Nizhne-Lenskoye to some extent involuntary – with the view to prevent the other large players to enter the market.
“ALROSA shall be cautious, should another applicant be the winner in this auction,” – diamond experts say. “In particular, if foreign capital will stand behind the deal.” More over, given high purchase price of these share, liabilities of Nizhne-Lenskoye will be a great burden of ALROSA.”
Other candidates for the above asset include Uspekh 2012 Ltd. and FinConsult Ltd. which have also got FAS approval for potential purchase of 100% voting shares in OJSC Nizhne-Lenskoye.
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