OREANDA-NEWS. December 25, 2007. Smart-holding CJSC, controlled by Vadim Novinskiy (a Russian businessman), and System Capital Management group, controlled by Rinat Akhmetov, have defined a format for integration of their mining and metallurgy assets, as a result of which the Smart N.V. holding became an owner of 25% + 1 share in the statutory capital of Metinvest B.V., UFC's press service reported. Under the integration plan, this November, Smart-holding transferred to Metinvest holding its stake in Ingulets Mining OJSC, amounting to 82.46%. "An agreement was also reached that as soon as the SPFU grants its permission, Smart will transfer to Metinvest the stake in Ingulets Mining amounting to 17.3%, encumbered by investment commitments," the press-release of the mining and metallurgy division of Rinat Akhmetov states. An agreement in principle was reached about transfer of the interest in Southern Mining, which will not exceed 25%, but, in future, if the deal is approved by the Antimonopoly Committee, it will be increased to 50%. Taking into account the fact that according to some data a 25% stake in Southern Mining is for more than 3 months is owned by structures of Rinat Akhmetov, as well as the benevolence of Alexei Kostusev, head of the Antimonopoly Committee, by the end of the first quarter of 2008, Metinvest will even more reinforce its positions in the ore market of Ukraine.

In addition, after obtaining of permissions from the European antimonopoly authorities, Smart will transfer to Metinvest its stakes in Makeevka Steel CJSC (Donetsk region) in amount of 90.18% and Promet Steel (rolling mill in Bulgaria) in amount of 90%. It is expected that the all relevant permissions in respect of these companies will be obtained by the end of the first quarter of 2008. Metinvest has already got the permission from the domestic regulators for Makeevka Steel shares consolidation.

Metinvest group is the largest Ukraine's iron and steel company. The group companies produce 10.5 mn tonnes of steel and more than 38 mn tonnes of iron-ore materials. Last year its consolidated earnings amounted to $5.65 bn, EBITDA – $1.713 bn, net consolidated profit – $1.026 bn. Metinvest holding LLC is a managing company of Metinvest group. The owners of Metinvest Holding LLC are the Holland-based Metinvest B.V. (51.15%) and SCM CJSC (Donetsk, 48.85%). 100% in Metinvest B.V belongs to (Cyprus), a subsidiary of SCM CJSC.

Smart-holding CJSC, established in 2006, manages in addition to Ingulets Mining OJSC, a number of mining and metallurgy assets: Makeevka Steel CJSC (the Donetsk region) and Promet Steel (Bulgaria) – till the moment of their transfer to Metinvest group, as well as Balaklava Mine Group (Sevastopol). The sphere of Smart-holding interests also includes the machine engineering assets (Dneproservis OJSC, Kherson Shipyard OJSC), agrarian assets (Veres group, Argocombinat Kalita OJSC and Kalitianskiy Experimental Animal Feed and Premixes OJSC) and real estate (Eugene LLC).