OREANDA-NEWS. On October 02, 2007 the Supervisory Board of ALROSA held its meeting in Moscow under the chairmanship of its head Vice-Premier, RF Finance Minister Alexey Kudrin, reported the press-centre of ALROSA.

The Board discharged M.V. Ganchenko (former ALROSA Chief Engineer) and A.V. Kozupeyev (former Director of the Anabar Mining Division) from their mandate as members of the Company’s Executive Board following the termination of their employment with ALROSA.

The Board approved as new members of the Company’s Executive Board recent senior management appointees Vice-President G.V. Klimenko, Chief Engineer A.I. Yefimov, Head of Capital Construction Division I.V. Sobolev, Director of the Anabar Mining Division V.T. Kurnev.

The Board voted to accept adjusted ALROSA major performance targets and budget for 2007 as proposed by the Executive Board:

Rough diamond production (including the production of OJSC ALROSA-Nyurba - USD 2315,7 million

Rough diamond production by ALROSA Co. Ltd. - USD 1757,4 million

Revenues from core product sales,   total - USD 2927,7 million, including:

- sales by ALROSA Co. Ltd. - USD 2270,7 million
- rough diamond sales - USD 2111,0 million
- polished diamond sales - USD 159,7 million
- sales by OJSC ALROSA-Nyurba - USD 657,0 million

Revenues from product (work and services) sales - RUR 72186,0 million

Profit from product (work and services) sales - RUR 25243,2 million.

Net profit - RUR 13930,9 million

Capital expenditure - RUR 19192,2 million

Prospecting and Exploration budget(exclusive of on-mine-site exploration expenses)- RUR 2584,9 million

R&D expenditure - RUR 468,3 million

Based on the amicable settlement agreement between the Russian Federation and the Republic of Sakha (Yakutia) approved on 20th December, 2006 by the RF Supreme Arbitration Court ruling in respect of Arbitration Case #7305/06, The Supervisory Board of ALROSA resolved as follows:

- to call an extraordinary general meeting of shareholders of ALROSA Co. Ltd. (EGM) in Mirny (Republic of Sakha (Yakutia)) on 10th November, 2007;

- to propose to the EGM to amend the Charter of ALROSA Company Limited as follows: "The Company has a right to issue in addition to its outstanding shares (authorized shares) 72726 (seventy-two thousand seven hundred and twenty-six) registered ordinary shares with a nominal value of 13502 (thirteen thousand five hundred and two) rubles 50 (fifty) kopecks each. The authorized shares represent the same rights as the outstanding shares of the corresponding category (type) as provided for by this Charter";

- to propose to the EGM to authorize an increase in the Company’s charter capital by
981 982 815 rubles through a fresh issue private offering;

- the private offering price is set at 841 000 rubles for each share;

- the private offering price for persons with pre-emptive rights is 841 000 rubles for each share;

- the mode of payment for the privately offered shares is the property (a stake in the joint ownership of the property) of the former PNO Yakutalmaz;

- assessment of the market value of the assets to be used as payment for the private offering has been made by CJSC “Centre of Professional Valuation”. 

Pursuant to the Amicable Settlement Agreement:
- ALROSA charter capital is subject to an increase through a fresh issue of shares and their private placement in favour of the Russian Federation, the Republic of Sakha (Yakutia) and the municipalities of the Anabar Ethnic (Dolgano-Evenk) Ulus, Verkhnevilyuisky Ulus (District), Vilyui Ulus (District), Lensk District, Mirny District, Nyurba District, Olenyok Evenk Ethnic District, Suntar Ulus (District);

- the placement will take place through a private offering to the above shareholders and their payment for the issue by stakes in the joint ownership of the former PNO Yakutalmaz property.

The Supervisory Board also proposed that the acquisition by ALROSA of a stake in the joint ownership of the former PNO Yakutalmaz property from OAO VTB be approved by the EGM.