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OAO Severstal (CHMF), Russia’s second- largest steelmaker, will purchase about 20 percent of the equities offered by shareholders in a buyback announced in February following the spinoff of its Nordgold NV unit.
Severstal will buy back 170 million of the 864.8 million shares offered by holders, it said today in a statement. The company will complete the repurchase, representing 17 percent of its capital, at 390 rubles ($11.73) a share by July 4.
The producer announced the buyback after shares accumulated in its Lybica unit because Severstal holders exchanged their stock for Nordgold equities as part of the unit’s spinoff.
Minorities offered 5 percent of their stock, with the rest from Lybica, said Kirill Chuyko, a UBS AG (UBSN) analyst. As a result Severstal will buy 1 percent of minorities’ shares, Chuyko said.
Severstal will cancel the 17 percent holding it buys back.
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