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December 02, 2008


CZP cleared to float 25% of new issue abroad

Interfax reported that Chelyabinsk Zinc Plant is placing the bulk of an additional share issue among current shareholders and has obtained clearance to have 25% of the issue traded abroad.

The Federal Financial Markets Service said in a statement that it had registered the additional issue from which the company was placing 48,775,869 common shares, par value RUB 1 each among shareholders. At the same time, the FFMS cleared CZP which is already listed on the London Stock Exchange to have 25% or 12,193,965 of the new shares traded abroad.

CZP said in a statement at the time that the board of directors at CZP on July 6th 2007 approved a decision to increase charter capital nine fold to split the company's shares. The decision will boost charter capital from RUB 5,419,541 to RUB 48,775,869 consisting of common shares with a par value of RUB 1 each.

Mr Sergei Moiseyev board chairman of CZP's said that "The board decided to issue additional shares to increase their liquidity on the Russian market and raise the investment attractiveness of the company."

In connection with the new share issue, Chelyabinsk Zinc Plant and The Bank of New York plan to make corresponding amendments to the global depositary receipt program that was established under the Deposit Agreement between the Company and The Bank of New York. As a result of this amendment, the ratio of GDRs to common registered shares of the Company will change and amount to 1:1.

In accordance with the Russian securities legislation, the additional share issue by the CZP is subject to the approval by Russian Federal Financial Markets Service. The new shares will be distributed among the shareholders on the 5th business day after the date of the registration of the additional share issue.

CZP produces around 60% of Russia's zinc. It produced 148,384 tonnes of SHG zinc in 2006. Consolidated sales revenue to International Financial Reporting Standards was RUB 14.985 billion and net profit was RUB 2.871 billion in 2006.