Russian leading coal producer Sibuglemet may be sold by almost $2 billion

Photo: Sibuglemet

VEB.RF, one of Russia’s leading financial corporations plans to sell Sibuglemet, one of Russia’s largest coal producers for at least 122.9 billion rubles.

According to VEB.RF, Sibuglemet currently remains one of the largest independent suppliers of coal concentrates for coking in the domestic market, with 45% of its output being exported to China, Japan, Korea, India and the CIS countries. The balance reserves of Sibuglemet are 324.5 million tons, and industrial reserves - 94 million tons. In 2020, its total production amounted to 10.1 million tons, while for the current year it is expected to reach 11.8 million tons.

From 2015 to 2020, Sibuglemet was managed by Evraz of Roman Abramovich, Alexander Abramov and Alexander Frolov. At that period of time VEB conducted talks with the shareholders of Evraz for the sale of the company, which, however, did not bring any results. One of the reasons for this is the unresolved issue of Sibuglemet's debt to VEB.RF which is estimated 176 billion rubles and which, so far, has blocked any M&A details with the company.

According to some local analysts, in theory Sibuglemet could be of interest to metallurgical companies that do not have enough production facilities (NLMK, MMK).

By: Eugene Gerden