As previously reported during October, Mechel acquired 75% of Yakutugol OJSHC, bringing its holding up to 100%, and 71.21% of Elgaugol. The acquisition cost Mechel $US2.3 billion
Elgaugol owns the development licence of the Elga coal deposit, which holds coking coal reserves of 2.2 billion tonnes. According to estimates, coal reserves in the region could reach 30 - 40Bt.
The Elgaugol deposit gives Mechel access to a large deposit of high quality coking coals, laying a reliable foundation for long-term development of Mechel's coal mining.
"With ownership of Southern Kuzbass, Yakutugol and Elgaugol, we hope to establish a world-class modern coal mining company," Mechel CEO Igor Zyuzin.
The company has offered to acquire the 245,000 shares of Elgaugol for RUR 14,760.44 (about $US600) per share, which corresponds to the highest price of the shares over the last six months.
Minority shareholders have 70 days to decide whether to sell.