Rostselmash Hops on Canadian Tractors
Rostselmash, Russia's largest producer of agricultural combines, has acquired its first foreign asset, the Canadian tractor-maker Buhler. Rostselmash will pay $143.3 million in the next five years for about 80 percent of the common stock in the company. The Canadian company has announced that its board of directors has reacted positively to the Russian offer and formed a committee to prepare recommendations for shareholders.
An informed source told Kommersant, however, that a principal agreement on the sale has already been reached with John Buhler, owner of 78 percent of the stock in the company, and Rostselmash will receive a controlling package in the company by the end of September.
Buhler reports that Rostselmash has proposed that it sell 51 percent of its common stock at C$7.50 (US$7.20) each by the end of September. That stock is selling for C$6.20 (US$5.96) on the Toronto Stock Exchange. After that, Rostselmash proposes to buy another 29 percent of the stock by 2012 in increments of 7.25 percent at C$7.60 (US$&.30) per stock beginning in September 2009.
OAO Rostselmash, based in Rostov-on-Don, is produces Don, Niva, Vector and Acros combines. More than 90 percent of its stock belongs to the Novoe Sodruzhestvo Group, founded by Konstantin Babkin, Dmitry Udras and Yury Ryazanov. Rostselmash produced 5200 combines in 2006. Rostselmash and its subsidiaries had proceeds of $420 million in 2006. Net profit was not made public.
Buhler Industries Inc. produces tractors with a capacity of 290 to 535 hp. Its proceeds in 2006 were $168.3 million (down 13.5%), EBITDA was $14 million and net profit $4.4 million (down 52.1%). It sold 193 tractors in Russia last year.
www.kommersant.com
All the Article in Russian as of July 26, 2007
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