OREANDA-NEWS. March 25, 2011. At the AGM held on Mar 23, the ENMZ management reported that the company would lease the rolling mills from the affiliated Makievo Steelworks starting Apr-11.

Millennium Capital: the news is POSITIVE for ENMZ. Our quick calculations suggest the deal may dramatically alter the earnings outlook for ENMZ while bearing zero downside risk in the current situation when profitability cannot get worse. We highlight the revenues of ENMZ may go up ~10% in FY11 following the deal, while incremental costs should be minimal keeping the current transfer pricing intensity intact. Overall, we expect a strong positive impact on the company’s earnings already in FY11.