OREANDA-NEWS. November 02, 2012. Vnesheconombank closed a transaction on purchasing ordinary shares of CJSC Verkhnekamsk Potassium Company (it is incorporated in Akron Group) worth 6.7 billion rubles (213.3 million US dollars) as part of funding the project “Development of the Talitsky Part of the Verkhnekamsk Potassium-Magnesium Salts Deposit in the Perm Territory.

A decision to enter the company’s charter capital was approved by Vnesheconombank’s Supervisory Board in December of 2011.

The project provides for developing a potassium-magnesium salts deposit in the Perm territory by way of building a mine and a mining and processing integrated works with an annual production and processing volume of up to 7.2 million tons and with a potassium chloride output of 2 million tons

The project total value is estimated at about 2.8 billion US dollars. As of today, Akron Group invested in the project about 700 million US dollars. These funds were used to purchase the right to use subsurface.

At the first stage the project is to be funded through using funds received from Vnesheconombank’s participation in the company’s charter capital as well as funds from outside investors in particular CJSC Raiffeisen Bank  and the Eurasian Development Bank.

At the moment, additional share placement by closed subscription among interested investor is completed in full volume.

After registering an account on the additional placement of CJSC Verkhnekamsk Potassium Company’s shares, Vnesheconombank’s participation stake in the company’s charter capital will amount to 20% minus one share. The company’s majority stake will belong to Akron Group.

The project’s further financing is planned to be carried out through opening a credit line for the company by Vnesheconombank with a drawdown limit of 1.1 billion US dollars. Some expenses on the project will be covered by using OJSC Akron’s loans as well as by using money flows to be generated by the project during a phase-in of production facilities from a date of commissioning a production integrated works in 2016 to achieving rated capacity in 2018.

Vnesheconombank Deputy Chairman Anatoly Ballo said, “The Project on Developing the Verkhnekamsk Potassium and Magnesium Salts Deposit is Vnesheconombank’s first experience in interacting with Akron Group  and the Bank’s largest project in the Volga Federal District. At present, we are satisfied with the results of cooperation and hope to expand it to realize Vnesheconombank’s potential as a Bank for Development”.

The project is aimed at demonopolizing the Russian potassium fertilizers market, introducing advanced technologies in mining and processing potassium ores as well as deeper processing of natural raw materials. This project’s implementation will make it possible to create about 2.5 thousand jobs; revenues in budgets of all levels will amount to about 50 billion rubles. The project is in line with Vnesheconombank’s Memorandum on Financial Policies as it is designed to increase efficiency of natural resources utilization and helps to promote exports of Russian products.