Russian mining and steelmaking company Mechel has announced that it has signed an agreement for the disposal of several ferroalloys assets to Turkey-based privately-owned diversified industrial group Yildirim Group.
According to the agreement, Yildirim Group acquires Mechel's Voskhod Mining Plant located in Khromtau, Kazakhstan and its Tikhvin Ferroalloy Plant located in Tikhvin in Leningrad region of Russia for a total of $425 million. The buyer will pay the entire sum to Mechel immediately after the deal's closure. In order to close the deal, all required approvals by the Kazakh and Russian regulatory agencies and both sides' corporate management agencies are due to be obtained.
Tikhvin Ferroalloy Plant has a capacity to produce up to 120,000 mt per year of high-carbon ferrochrome used to produce stainless steel. As raw material, the plant uses the chrome ore concentrate produced at Voskhod mining plant which has total reserves of 20 million mt of chrome ore and has an annual beneficiation capacity of 1 million mt of raw chrome ore, which can be increased up to 1.5 million mt.
According to Yildirim Group, after the acquisition of Mechel's chrome division, the company will reach a consolidated 520,000 mt production capacity for high-quality high carbon ferrochrome in Turkey, Sweden and Russia. Additionally, Yildirim Group's total annual chrome ore production will now reach 2.5 million mt in Turkey and Kazakhstan for its internal ferrochrome production and chrome ore exports.