Irkutskenergo to finance the purchase of a hydro power plant for UC Rusal

Irkutskenergo will pay for the purchase of the Ondsky hydro power plant necessary for UC Rusal to supply energy to its Nadvoitsy aluminium plant. Only in H1 the company spent about 12 bln roubles for loans and the additional capitalization of various assets of O. Deripaska. Now Irkutskenergo will spend 2.6 bln roubles to its affiliate that purchases the hydro power plant and then the power plant will be transferred to UC Rusal. Inter RAO that holds 40% of shares of Irkutskenergo was traditionally opposed to the deal but couldn’t block it.

On September 8th the Board of Directors of Irkutskenergo approved the deals which are to provide the funds to “Eurosibenergo-teplovaya energiya” that purchases the Ondsky hydro power plant in Kareliya from TGK-1 (controlled by Gazprom energy holding). Now Irkutskenergo holds 51% in “Eurosibenergo-teplovaya energiya”, the rest belongs to Eurosibenergo (unites the assets of O. Deripaska, including 50.2% of shares of Irkutskenergo). Now Irkutskenergo will transfer 700 mln roubles to the registered capital of Eurosibenergo-teplovaya energiya thus increasing its stake to 99.93%. Irkutskenergo will also issue a 1.9 bln roubles loan to “Eurosibenergo-teplovaya energiya” until September 30th 2016 with an interest rate of 11.9% per annum.