Mechel, one of the leading Russian mining and steel groups, has announced the acquisition of 100 percent shares of Donau Commodities, which holds 87.9 percent of shares in Romanian steel plant Laminorul Braila, for a consideration of €9.4 million, subject to a final price adjustment which is expected to be agreed by the end of April 2010. The transaction was approved by the Romanian Competition Council on April 19, 2010.
The acquisition of Laminorul Braila is aimed at increasing the share of high margin products in the group's product portfolio. The plant will allow the production of downstream products from Mechel's billets and will increase synergies of all its Romanian assets. In addition, the new products (structural shapes and bulb bars) will expand Mechel's positions in the Romanian market and in the markets of other countries of the European Union, and will also allow diversification of distribution of the group's products.
Laminorul Braila's main production facilities include two rolling mills with a total capacity of over 380,000 mt per year. The rolling mills manufacture structural shapes of different types: beams, channel bars, equal and unequal angles for industrial, civil and machinery construction. This is the only plant in Romania manufacturing special profiles (bulb bars) which are used in shipbuilding. All the product types have European quality certificates. Bulb bars manufactured by the plant are certified by international sea registers such as DNV, BV, LR, ABS, GL and the Russian Sea Register.
In 2009 the plant manufactured more than 50,000 mt of structural shapes, and plans to increase its output for the future. About 65 percent of the plant's products are delivered to western and eastern Europe, and the rest are shipped to the Romanian domestic market. Laminorul Braila is sourced with billets supplied by Mechel Targoviste steel plant. The plant employs more than 570 people.
In addition, the Laminorul Braila plant is located in close proximity to Braila port, which allows for embarkation on to ships with cargo capacity of up to 5,000 mt. Constanta international port (Black Sea) is also located nearby, thus providing convenient logistics for the plant.