Severstal aquires 100% of Crew Gold Corporation

Amsterdam, January 10, 2011 – Nord Gold N.V. (“Nord Gold”), a subsidiary of OAO Severstal (“Severstal”) (LSE: SVST; RT CHMF), announced today that it had acquired through a subsidiary all common shares (“Common Shares”) of Crew Gold Corporation (“Crew Gold”) that it did not already own at a price of US$4.65 (CAD$4.62) per Common Share pursuant to a plan of arrangement under the laws of the Yukon Territory. A total of 7,077,313 Common Shares were acquired, which represent ownership and control of approximately 6.62% of the issued and outstanding Common Shares as at the date hereof.

 

Following this transaction Severstal will have ownership and control over 106,922,322  Common Shares, representing 100% of the issued and outstanding Common Shares as at the date hereof. The acquisition occurred under a statutory plan of arrangement which took effect as of January 7, 2011. The additional acquisition of Common Shares was effected to complete Severstal’s acquisition of Crew Gold.  Severstal controlled Crew Gold prior to this purchase and will continue to control Crew Gold.

 

Severstal began the acquisition of Crew Gold shares at the beginning of 2010, after Crew Gold had undertaken a restructuring in response to financial difficulties. In June 2010, Severstal became a control shareholder and, after acquiring a 43.21% stake from Endeavour Financial Corporation, Severstal became a 93.38% shareholder. Today Severstal announces its full control over Crew Gold.

 

Nikolai Zelenski, CEO of Nord Gold commented: “We are very pleased to fully integrate Crew Gold into our gold segment having assumed full control of its shares. This will enable us to continue and escalate ongoing investment into this asset, with a focus on improvements to its operational and financial efficiency. Crew Gold is a very significant part of our growing gold mining business and one which I believe will deliver real value to shareholders as well as make a contribution to the development of the local territory and Guinea as a whole.”

 

 

About Severstal

 

OAO Severstal is one of the world’s leading integrated steel and mining companies with listings in Russia and on the London Stock Exchange. Incorporated in 1993, the company focuses on high value added and unique niche products. Its main steel-making assets are in Russia, the United States and Europe. Severstal’s mining assets in Russia and the USA provide the company with strong self-sufficiency in coking coal and iron ore in Russia, and good self-sufficiency in coking coal in the USA.  In 2009, Severstal produced 16.7 million tonnes of steel.

 

Nord Gold (ex-Severstal Gold) includes all Severstal’s gold mining assets and is an established international, pure-gold producer focused on emerging markets with currently eight producing mines, two development projects, five advanced exploration projects and a broad portfolio of early exploration projects and licenses located across West Africa in Guinea and Burkina Faso, Kazakhstan and the Russian Federation.

 

Crew Gold operates the LEFA Gold Mine in Guinea with 2009 gold production of 177,623 oz and gold production of 138,081 oz in the three quarters ended September 30, 2010.