Mechel Chairman to have controlling stake

Mechel Chairman to have controlling stake

Mechel, a leading Russian integrated mining and steel group, on Friday said Chairman Igor Zyuzin will raise his stake in the company to a controlling interest. Mechel said its core shareholders have agreed to a deal in which Zyuzin will buy a 42.2 percent stake from CEO Vladimir Iorich over the next 12 months, bringing Zyuzin's total interest to 51 percent. The company said Zyuzin is considering several financing options, such as raising money through capital markets or a strategic transaction. Separately, Mechel reported 2005 production levels on Friday. The mining and iron ore increased, while coal yields remained flat with 2004 levels and steel production declined. Production of iron ore concentrate jumped 17 percent year on year to 4.5 million metric tons in 2005. Coal production remained unchanged at 15.65 million metric tons as Mechel reduced coking coal production by 8 percent to 8.6 million metric tons due to descending demand. Steel production fell 5 percent year on year to 5.9 million metric tons in 2005.