Result of Exchange for Nordgold GDRs

Not for release, publication or distribution in whole or in part in or into the United States or italy

 

Severstal announces on behalf of Lybica the results of the Exchange for Nordgold GDRs

On 30 November 2011, OAO Severstal (“Severstal”) announced the exchange by its wholly owned indirect subsidiary, Lybica Holdings B.V. (“Lybica”), of the global depositary receipts (“GDRs”) representing shares of its subsidiary, Nord Gold N.V. (“Nordgold”), for Severstal Shares and Severstal GDRs (the “Exchange”) on the terms and conditions contained in the Exchange document dated 30 November 2011 and the addenda to the Exchange document dated 5 December 2011 and 21 December 2011 (together, the “Exchange Document”). Capitalised terms used and not otherwise defined in this announcement have the meanings ascribed to them in the Exchange Document.

The Expiration Time has now passed, and Severstal hereby announces on behalf of Lybica that Lybica has received acceptances with respect to 16,065,020 Severstal GDRs and has received valid share forms of acceptance with respect to 4,309,365 Severstal Shares, for a total of 20,374,385 Severstal Securities, which represents approximately 10.6% of Nordgold share capital according to the Exchange Ratio.

Lybica has also confirmed that (i) the 5% Condition has been satisfied and (ii) the Severstal Share Delivery Period has commenced and will expire at 5:00pm Moscow time on 24 January 2012.

Delivery of the Nordgold GDRs in respect of Severstal GDRs tendered is expected to occur on 18 January 2012 and listing of the Nordgold GDRs on the London Stock Exchange is expected on the following morning. Delivery of Nordgold GDRs in respect of Severstal Shares delivered is expected to occur on or around 27 January 2012. The exchange with Rayglow Limited, an entity controlled by Mr Alexey Mordashov, of Severstal Shares for the Nordgold Shares not taken up in the Exchange is expected to occur by mid-February 2012.

Nikolai Zelenski, CEO of Nordgold, said: “We are delighted with the support shown for Nordgold by those shareholders that accepted the offer. As an independent, pure-play gold producer focussed on emerging markets I think we have huge potential to continue to grow the business and to deliver value to our shareholders.”

Chris Clark, Chairman of Severstal’s Board of Directors, said: “The listing of Nordgold marks the end of Severstal's successful involvement in gold. The transaction enables Severstal now to focus entirely on its core strengths as a leading vertically integrated steel and steel-related mining company. On behalf of Severstal, I would like to wish Nordgold, its management team and its shareholders every success for the future.”

Enquiries

Severstal Investor Relations

Vladimir Zaluzhsky

T: +7 (495) 926-77-66

vladimir.zaluzhsky@severstal.com

Severstal's international media communications agent - Hudson Sandler

Andrew Hayes / Andrew Leach / Maria Ignatova / Alex Brennan

T: +44 (0) 20 7796 4133

Severstal's shareholders' information agent - FTI Consulting

Ben Brewerton / Chris Welsh +44 20 7831 3113

Oleg Leonov / Maria Shiryaevskaya +7 495 795 0623

Holborn Gate, 26 Southampton Buildings

London, WC2A 1PB

+44 (0) 20 7269 7263

Shareholder Hotline

Moscow: 8 800 100 5506 (for Russian speakers)

London: +44 (0) 800 055 6507 (for English speakers)

 

Nothing in this document constitutes an advertisement or offer or an invitation to make offers or to purchase, any securities in any jurisdiction.

The securities to which this announcement relates (other than Severstal shares) have not been and will not be registered in the Russian Federation or admitted to public placement and/or public circulation in the Russian Federation and may not be offered or sold in the Russian Federation except as provided by Russian law.

The information contained herein is not for release, publication or distribution in whole or in part in or into the United States. This announcement does not contain or constitute or form part of an offer or invitation to sell shares or GDRs in Severstal, or any solicitation of any offer to purchase or subscribe for shares or GDRs in Nordgold or any other securities, nor shall it (or any part of it) or the fact of its distribution form the basis of, or be relied on in connection with, any contract therefore. In particular, this announcement does not contain or constitute an offer for sale or the solicitation of an offer to purchase securities in the United States. The securities referred to herein have not been and will not be registered under the US Securities Act of 1933, as amended (the Securities Act), and may not be offered or sold in the United States absent registration under the Securities Act or pursuant to an available exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

Citigroup Global Markets Limited and Deutsche Bank AG, acting through its London branch, both of which are authorised and regulated in the United Kingdom by the Financial Services Authority, are acting exclusively for Lybica and Severstal and no-one else in connection with the transactions described in this announcement. They will not regard any other person as their respective clients in relation to the transactions described in this announcement and will not be responsible to anyone other than Lybica and Severstal for providing the protections afforded to their respective clients, nor for providing advice in relation to the transactions described in this announcement, the contents of this announcement or any transaction, arrangement or other matter referred to herein.

This announcement may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements may be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will" or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. Forward-looking statements may and often do differ materially from actual results. Any forward-looking statements reflect either Severstal, Lybica or Nordgold's current view with respect to future events and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to the group's business, results of operations, financial position, liquidity, prospects, growth and strategies. Forward-looking statements speak only as of the date they are made.