Alrosa mulls seeking new investors after reorganization into JSC
MOSCOW. May 25 (Interfax) - The transformation of Alrosa, Russia's diamond monopoly, from a closed into an open-stock company gives the company an opportunity to consider seeking new investors and additional share capital, company CEO Fyodor Andreyev said.
"My opinion as a mercenary manager is that the process of reorganization from a CJSC into a JSC should be step by step. The first step is simply opening Alrosa without discussing an additional [share] issue. The second step could be finding additional shareholders and additional capital," the press service to the Yakutsk parliament cited Andreyev as saying during a meeting with parliamentary deputies.
In such conditions as when "the crisis is not over and a second wave expected," the company needs to be able to wield an instrument such raising money for capital, which can only be done when the company is a stock company, Andreyev said.
Alrosa needs the money for the construction of the underground Mir, Aikhal, and Udachny mines, as well as for opening a group of iron ore deposits - Taezhnoye, Desovskoye, Tarynnakhskoye, and Gorkitskoye - which are located in southern Yakutia. The company's iron-ore division MMC Timir needs roughly $3 billion for its projects, Andreyev said.
Alrosa's opening will also make it possible to ensure the rights of minority shareholders who wish to sell their shares but cannot do so at the present time, Andreyev said. "Ideally, we want to make Alrosa a people's company. Issuing additional shares would allow company workers living in the republic to acquire stock," he said.
Alrosa shares cannot now be bought on the free market. The Russian property fund Rosimuschestvo holds 50.9% of the shares, Yakutia's property fund - 32%, and eight ulus (regional political divisions) - 8% in aggregate. The other 9% is held by both legal entities and private investors.
Investment companies that hold stock in Alrosa are working up evaluations of company capitalization for their financial reports. Only one of them, by Sweden's Vostok Nafta, is made public. In its last report on its investment in Alrosa, Vostok Nafta reckoned from a figure of $2.18 billion for the entire company ($8,000 per share). In its last report before the economic crisis - for H1 2008 - the Swedish company valued Alrosa shares at $28,000 per, or $7.6 billion for the entire company.