EVRAZ HIGHVELD STEEL & VANADIUM LTD - Conclusion of contract manufacturing agreement

Conclusion of contract manufacturing agreement

EVRAZ Highveld Steel and Vanadium Limited
(Incorporated in the Republic of South Africa)
(Registration No: 1960/001900/06)
Share code: EHS ISIN: ZAE000146171
(“Highveld” or “the Company”)




CONCLUSION OF CONTRACT MANUFACTURING AGREEMENT BETWEEN ARCELORMITTAL
SOUTH AFRICA AND HIGHVELD STRUCTURAL MILL PROPRIETARY LIMITED
(“HSM”) AND EVRAZ HIGHVELD STEEL & VANADIUM LIMITED (IN BUSINESS
RESCUE) (“Highveld”)



The joint Business Rescue Practitioners in terms of the wind-down
contemplated in Proposal 3 of the Business Rescue Plan are pleased to
advise that a contract manufacturing agreement (“Agreement”), which
is still subject to certain  conditions precedent, has now been
concluded between ArcelorMittal South Africa, Highveld and HSM (a
newly formed subsidiary of Highveld) in terms of which ArcelorMittal
South Africa will supply blooms to HSM for processing into heavy
structural steel. This will result in the re-opening of the Highveld
heavy structural mill, thus making available the supply of locally
produced South African large structural steel products into the
market again.



The re-opening of the mill is a positive development and will result
in the added benefit of creating further jobs.


The Agreement will operate for an initial period of two years with
an option to extend for a further period of one year.


ArcelorMittal  South Africa also has an option to purchase the
business of HSM and the land or the shares in HSM, subject to
certain further regulatory and governance approvals that may be
required.


The detail regarding implementation is being finalised but it is
envisaged that the mill will begin operations in 2017.
This   important   milestone  was   made  possible   with   the support of
various stakeholders, for which support we are all grateful.


eMalahleni
22 December 2016


J.P. Morgan Equities South Africa (Pty) Ltd.


Sponsor

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