Mechel, one of the leading Russian mining and steel groups, has announced that its subsidiary Mechel Service Global B.V., which manages the group's steel product retail sales and service network, has acquired 100 percent of shares of Turkish steel trading group Ramateks for a consideration of $3 million. Debts of Ramateks assumed by Mechel, the majority of which (77 percent) is trade financing, did not exceed $13.8 million.
Ramateks, the revenue of which in 2009 amounted to about $33 million, is specialized in distribution of construction and stainless steel long products as well as of other types of steel products both to domestic and foreign customers. Ramateks' storage capacities are located in Istanbul and Konya. The company also has equipment for steel product cutting.
With 10,000 square meters of its own warehousing capacities and about 4,500 square meters of leased area, Ramateks' total storage capacity amounts to 21,000 mt of steel products. Ramateks is expected to increase its sales volumes by 2.5 times by 2014 after becoming a part of Mechel group.
"We are expanding Mechel Service's operations in the Balkan region as we consider this market to be very promising with serious growth potential. Eastern Europe today is one of our priorities for development," Mechel Service's managing director Andrey Ponomarev said, adding that in Q1 2010 sales of Mechel Service's Eastern European branches increased by three times year on year, due to the geographical expansion of its network and the increase in the efficiency of its existing subdivisions.