Ruukki Group Plc, Investor News, 11 November 2008 at 11:09 a.m. SUMMARY OF RUUKKI GROUP PLC'S MAIN SHAREHOLDERS AND MAIN COMMERCIAL TERMS OF THE CHROME BUSINESS ACQUISITION The Board of Directors of Ruukki Group Plc has decided to restate some facts related to the Company's shareholder structure and to the recent chrome business acquisition in order to clarify the situation. Ruukki Group emphasises that the information below has already been published by stock exchange releases and/or on Ruukki Group's website and thus does not include any new information. 1. Summary of shareholdings by Ruukki Group Plc's Board and certain other major shareholders To clear up any recent potential confusion on Ruukki Group Plc's ownership structure, the holdings by the Board members and/or the companies controlled or influenced by them, thus also being permanent insiders in Ruukki Group Plc, were the following on 7 November 2008 (as according to the public insider register on Ruukki Group's website): -------------------------------------------------------------------------------- | Board member / | Actual/ | Potential/ | Total | % of shares | | Shareholder | Shares | Forwards | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Hoyer Thomas | 100 000 | | 100 000 | 0.03 % | -------------------------------------------------------------------------------- | Hukkanen Esa | 5 010 100 | | 5 010 100 | 1.73 % | -------------------------------------------------------------------------------- | Kankaala Markku | 9 698 890 | | 9 698 890 | 3.34 % | -------------------------------------------------------------------------------- | Minor under | 400 | | 400 | 0.00 % | | guardianship | | | | | -------------------------------------------------------------------------------- | Manojlovic Jelena | | | | | -------------------------------------------------------------------------------- | Controlled | 11 000 000 | 60 966 500 | 71 966 500 | 24.81 % | | corporation of | | | | | | spouse - RCS | | | | | | Trading Corp Ltd | | | | | -------------------------------------------------------------------------------- | Controlled | 15 000 000 | | 15 000 000 | 5.17 % | | corporation of | | | | | | spouse - Kermas | | | | | | Limited | | | | | -------------------------------------------------------------------------------- | McConnachie Terence | 0 | | 0 | 0.00 % | -------------------------------------------------------------------------------- | Smit Alwyn | 0 | | 0 | 0.00 % | -------------------------------------------------------------------------------- | Controlled | 11 900 000 | | 11 900 000 | 4.10 % | | Corporation - | | | | | | Bassanio | | | | | -------------------------------------------------------------------------------- In addition to the table above, Kermas Limited has 73,170,731 option rights related to the potential future earn-out consideration, and Alwyn Smit has 2,900,000 option rights. In addition, the holdings by other major shareholders (ownership interest > 10 %) on 7 November 2008 were the following (as according to major shareholders list and flagging notifications submitted by the shareholders): -------------------------------------------------------------------------------- | Shareholder | Actual/ | Potential/ | Total | % of | | | Shares | Forwards | | shares | -------------------------------------------------------------------------------- | Atkey Ltd + Aida | 43 664 864 | | 43 664 864 | 15.06 % | | Djakov | | | | | -------------------------------------------------------------------------------- | Hanwa Company | 30 000 000 | | 30 000 000 | 10.34 % | | Limited | | | | | -------------------------------------------------------------------------------- The total number of registered shares is 290,034,022. Since Ruukki Group Plc currently has share buy-back program, with a maximum buy-back amount at 10,000,000 own shares, being implemented, the number of votes differs from the number of shares by the amount of treasury shares held by the company. 2. Ruukki Group Plc's strategy According to Alwyn Smit, Chairman and CEO of Ruukki Group Plc: “Even though the economic growth has been stalling globally and despite the financial turmoil and market changes, Ruukki Group continues to proceed with its expansion strategy as planned. Even though the recent market changes are regrettable, there are however also positive features: Ruukki Group's cash funds enable the Group to carry out its strategy to acquire new operations and expand its current operations in the current market situation with smaller investments than before. Ruukki Group thus has advantage over competitors that are not capitalized as well. The Group has free cash available for investment about 200 million Euros.” Ruukki Group's Board of Directors redefined the Group strategy during the second quarter of 2008. It was announced that the Group was aiming at expanding its operations by entering into minerals business. In June Ruukki Group announced that it had entered into a preliminary agreement to acquire chrome ore and ferrochrome operations. The acquisition was completed at the end of October based on the 28 Oct 2008 Extraordinary General Meeting's decision. In addition, Ruukki Group Plc is proactively investigating further opportunities to expand its ferrochrome and chrome alloys operations. As regards the forestry business, the existing wood processing related industrial operations in Finland are to be strengthened and the Russian investment projects to be continued. For the Russian sawmill negotiations are ongoing to locate the Group's sawmill into relative vicinity of the border of Finland and Russia. As for the pulp mill project, Ruukki Group searches for industrial and financial partners to implement the project. 3. Key features of the chrome ore and ferrochrome acquisition The Extraordinary General Meeting of Ruukki Group Plc decided in accordance with the Board's proposal to carry out acquisition into chrome ore and ferrochrome businesses, and consequently Ruukki Group has completed the closing of the acquisition as follows: - Ruukki Group Plc has paid EUR 80 million in cash to Kermas Limited as purchase consideration; - Ruukki Group now owns all the shares in the Maltese RCS Limited and approximately 98.75 % of the shares in the Turkish Türk Maadin Sirketi A.S.; - As a method of payment for potential future earn-out consideration, Kermas Limited has been granted altogether 73,170,731 option rights (strike price EUR 2.30 per share, with dividend adjustment). The potential additional earn-out purchase consideration payable in share options will be 50 % of the combined net profit of RCS and TMS during a five year period covering financial years 2009 - 2013 and, capped at EUR 150 million. The completed transaction differs from the preliminary agreement signed in June 2008 e.g. in the following points. At the closing Ruukki Group has now paid EUR 80 million in cash and the potential future earn-out consideration will be paid in Ruukki Group share options, maximum of 73,170,731 options, capped at EUR 150 million. On the preliminary agreement the parties had agreed that Ruukki would pay EUR 108 million to Kermas Limited in cash at the closing of the transaction. Moreover, an additional EUR 92 million of the purchase price was agreed to be paid by issuing a convertible loan, the maturity of which was intended to be five years from the subscription. According to the preliminary agreement the loan could be converted into new shares in Ruukki at EUR 2.30 per share. In case convertible bond would have been fully converted into Ruukki's shares, altogether 40,000,000 million new Ruukki shares would have been issued. Any additional earn-out payment was agreed to be paid in cash as a lump-sum after the four years' guarantee period. ”Since Ruukki Group Plc paid in the RCS-TMS chrome business acquisition less in cash and did not have to issue a convertible loan compared to the original structure agreed in June 2008, I see this final transaction structure as an improvement on the original transaction, in that Ruukki Group has preserved cash, by paying less up front and no interest-bearing debt was placed on the balance sheet, as originally intended”, states Alwyn Smit. RUUKKI GROUP PLC Alwyn Smit Chairman of the Board and CEO For additional information, please contact: Alwyn Smit Chairman of the Board and CEO Ruukki Group Plc Telephone +41 7960 19094 www.ruukkigroup.fi This investor news release is based on a translation into English of a document written in Finnish. In case of any discrepancies, inconsistencies or inaccuracies, the Finnish version of the release shall prevail.
SUMMARY OF RUUKKI GROUP PLC'S MAIN SHAREHOLDERS AND MAIN COMMERCIAL TERMS OF THE CHROME BUSINESS ACQUISITION
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