Acron may sell VEB stake in potash project
MOSCOW. Dec 15 (Interfax) - Vnesheconombank (VEB) may be in line to acquire a 20% minus one share interest in Acron's Talitsk potassium section development project.
Business daily Kommersant writes that the bank may buy a stake in Verkhnekamsk Potash Company, which holds the license rights to the section.
The stake is valued at 6.7 billion rubles. VEB would also extend the company a credit of $1.12 billion for six years at 3M LIBOR+6.5% per annum. But Acron would have to find a buyer for another 29% in the project. VEB has put the question of buying into the project on the agenda for a supervisory board meeting planned for Friday.
Acron originally wanted to sell VEB 49% for $720 million in order to put the money into development.
The plan is for VEB to buy into Verkhnekamsk Potash Company next year, and for Acron to sell 29% plus one share to another investor for $327 million and buy it back before 2020.
The bank will hold onto the Verkhnekamsk Potash Company stake until Acron pays back the credit extended. The agreement stipulates that the bank will sell the shares not later than January 31, 2025 at a price based on yield of 8% per annum and factoring in initial investments of $225.72 million for the period during which it is an actual owner ($388 million total as a result). VEB management approved all the pertinent decisions at the end of last month.
However, the bank may put off financing the project if Acron fails to meet a certain number of conditions. In particular, if the company exceeds its budget or finds itself short of money there will be no additional financing for the deposit's development. Acron or an agent it authorizes is obliged to buy up the outstanding 29% plus one share for an additional issue in the event that stake does not attract the interest other investors.
Acron has decided to reorganize the limited-liability company Verkhnekamsk Potash Company into a closed joint stock outfit.
