Russia’s Kuzbass Fuel Co to hold SPO of over 15.6% in 3 years

MOSCOW, Mar 31 (PRIME) -- Russian steam coal producer Kuzbass Fuel Company (KTK) plans to hold a secondary share offering (SPO) of at least 15.6% shares within the next three years, the company said in a statement Monday.

“The exchange for the offering will be selected taking into account the capital markets’ conditions. The shares will be offered by the company’s management. The free float will account for half of the shareholder capital,” the company said.

CEO and controlling shareholders of KTK, Igor Prokudin, said that the company is demonstrating significant growth in production and financial results. “We have increased mining, significantly increased the quality of coal by building two washing plants. We are also increasing coal reserves and upgrading equipment,” Prokudin said.

But the company’s market value decreased mainly due to a fall in steam coal prices, which started in the middle of 2012. The company is currently undervalued by the market and to improve the situation, the company decided to hold the SPO.

“As situation on the market improves, we will start preparation and make the secondary offering,” Prokudin added.

Prokudin and Board Chairman Vadim Danilov, control 50.001% and 15.61%, respectively, through Cyprus-based companies, while a 34% stake accounts for free float.

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