Investment opportunity with a producer of coking coal

Investment opportunity with a producer of coking coal VTB Capital is mandated to offer an opportunity to buy 41% of a leading Russian producer of coking coal and other products The Company’s Shareholders are prepared to go ahead with the deal in order to streamline the Company’s operations, bring in new dedicated shareholders committed to moving the Company forward and enhance corporate governance and ownership structure.

Business profile (1) • Industry: Mining • The Company is engaged in producing coal (mostly coking coal) and transporting it to its clients • Client base comprises large businesses in the field of manufacturing • The Company operates predominantly in the domestic market while also exporting its products to Ukraine and other CIS countries

Business Profile (2) • The Company includes four mines in operation, a preparation plant, companies engaged in infrastructure development, transportation, and trading • The Company is operating in a competitive market: Firms Sales, mn USD Sales Growth Largest Market The Company 682. 10 -1. 1% Russia (99. 2%) Rival 1 742. 35 12. 1% Russia (100%) Rival 2 768. 20 69. 1% Europe (42. 6%) Rival 3 784. 92 39% UK (100%)

Comparative advantage • The Company expects to expand its operations substantially in the coming years building on its rich mining fields and effective logistics base PV of FCF ($mn) Production forecast 14 10. 9 12 6. 3 229 12 200 9 10 8 300 6. 9 162 167 2014 E 2015 E 242 105 6 100 4 2 0 2011 2012 E 2013 E 2014 E 2015 E 0 2013 E PV of FCF 2016 E 2017 E

Major Russian consumers of the Company’s coal products 40% 37% 30% 26% 26% 23% 21% 22% 20% 15% 12% 10% 9% 8% 7% 9% 7% 7% 4% 0% MMK Evraz Kemerovo-Koks 1 H 2011 NLMK 2 H 2011 1 H 2012 Mechel Other

Transaction details • Preferred type of transaction: Buyout or Acquisition • Acceptable Type of Investment: Equity • Ownership position: Controlling • Transaction fee: Paid by the Seller

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