UNITED COMPANY RUSAL, INTERNATIONAL 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.
(Incorporated under the laws of Jersey with limited liability)
(Stock Code: 486)Reference is made to the announcements of the Company dated 2 July 2015, 30 December 2015 and 12 January 2016 in relation to the Previously Disclosed Repair Services Contracts.
The Company announces that a member of the Group entered into the New 2016 Repair Services Contract with an associate of En+, pursuant to which the associate of En+ agreed to provide repair services to the member of the Group.
The Company announces that a member of the Group, entered into the contract with an associate of En+, pursuant to which the associate of En+ agreed to provide repair services to the member of the Group (the "New 2016 Repair Services Contract"), details of which are set out below.
No. | Date of contract | Customer (member of the Group) | Contractor (associate of En+) | Term of contract | Repair services | Estimated consideration payable for the year ending 31 December 2016, excluding VAT (USD) | Payment terms |
1 | 4 February 2016 | RUSAL Achinsk | Bratskenergoremont | Up to 31 July 2016 | Extensive repairs of boiler | 2,733,663 | 30% of the amount- advance payment within 5th date of the month; 70% of the amount - within 30 calendar days from the date of the signing the certificate of work completion |
Total estimated consideration for the year: | 2,733,663 |
The contract price payable under the New 2016 Repair Services Contract has been determined with reference to the market price and on terms no less favourable than those prevailing in the Russian market for repair services of the same type and quality and those offered by the associates of En+ to independent third parties. The basis of calculation of payments under the New 2016 Repair Services Contract is the price of contracts offered by the associate of En+ which is based on the estimated cost (including labour cost and the necessary materials) for the relevant repair works. The Company invited several organizations to take part in the tender in relation to the relevant required repair services and chose the contractor offering the best terms and conditions (taking into account the price and quality offered by those contractors) and then entered into contracts with the chosen contractor.
Based on the terms of the New 2016 Repair Services Contract and the Previously Disclosed Repair Services Contracts, the annual aggregate transaction amount that is payable by the Group to the associates of En+ for the financial year ending 31 December 2016 is estimated to be approximately USD11.134 million.
The annual aggregate transaction amount is estimated by the Directors based on the amount of repair services to be received and their contract price.
Pursuant to Rule 14A.81 of the Listing Rules, the continuing connected transactions contemplated under the New 2016 Repair Services Contract and the Previously Disclosed Repair Services Contracts should be aggregated, as they were entered into by the Group with the associates of the same group of connected persons who are parties connected or otherwise associated with one another, and the subject matter of each of the contracts relates to the receipt of repair and maintenance services by members of the Group.
The Directors consider that the entering into of the New 2016 Repair Services Contract is for the benefit of the Company, as the contractor offered a competitive price.
The Directors (including the independent non-executive Directors) consider that the New 2016 Repair Services Contract has been negotiated on an arm's length basis and on normal commercial terms which are fair and reasonable and the transactions contemplated under the New 2016 Repair Services Contract 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 under the New 2016 Repair Services Contract, save for Mr. Deripaska, Mr. Maxim Sokov, Ms. Olga Mashkovskaya and Ms. Gulzhan Moldazhanova, who are directors of En+, being the holding company of Bratskenergoremont. Mr. Deripaska is also indirectly interested in more than 50% of the issued share capital of En+. Accordingly, Mr. Deripaska, Mr. Maxim Sokov, Ms. Olga Mashkovskaya and Ms. Gulzhan Moldazhanova did not vote on the Board resolution approving the New 2016 Repair Services Contract.
Bratskenergoremont is held by En+ as to more than 30% of the issued share capital and is therefore an associate of En+ which is a substantial shareholder of the Company and thus is a connected person of the Company under the Listing Rules.
The estimated annual aggregate transaction amount of the continuing connected transactions under the New 2016 Repair Services Contract and the Previously Disclosed Repair Services Contracts for the financial year ending 31 December 2016 is more than 0.1% but less than 5% under the applicable percentage ratios. Accordingly, pursuant to Rule 14A.76 of the Listing Rules, the transactions contemplated under these contracts are only subject to the announcement requirements set out in Rules 14A.35 and 14A.68, the annual review requirements set out in Rules 14A.49, 14A.55 to 14A.59, 14A.71 and 14A.72 and the requirements set out in Rules 14A.34 and 14A.50 to 14A.54 of the Listing Rules. These transactions are exempt from the circular and the independent shareholders' approval requirements under Chapter 14A of the Listing Rules.
Details of the New 2016 Repair Services Contract and the Previously Disclosed Repair Services Contracts will be included in the next annual report and accounts of the Company in accordance with Rule 14A.71 of the Listing Rules where appropriate.
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.
Bratskenergoremont is principally engaged in activities for supporting of operability of the equipment, production of electric installation, all-construction works and others.
DEFINITIONSIn this announcement, the following expressions have the following meanings, unless the context otherwise requires:
"associate(s)" has the same meaning ascribed thereto 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 thereto under the Listing Rules.
"continuing connected transactions"
has the same meaning ascribed thereto 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.
"Listing Rules" the Rules Governing the Listing of Securities on the Stock Exchange.
"Mr. Deripaska" Mr. Oleg Deripaska, an executive Director.
"percentage ratios" the percentage ratios under Rule 14.07 of the Listing Rules.
"Previously Disclosed Repair Services
Contracts"
the repair services contracts between members of the Group and the associates of En+, pursuant to which the associates of En+ agreed to provide repair services to members of the Group during the year 2016, as disclosed in the announcements of the Company dated 2 July 2015, 30
December 2015 and 12 January 2016.
"Stock Exchange" The Stock Exchange of Hong Kong Limited.
United Company RUSAL plc issued this content on 05 February 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 05 February 2016 00:49:26 UTC
Original Document: http://www.rusal.ru/upload/uf/82d/LTN20160205069.pdf
