Moscow, 26 March 2007. The public auction to sell the 25.03 percent stake held by RAO "UES of Russia" in OAO "WGC-5"* will be held on 6 June 2007. Bids will be accepted from 27 March through 28 May 2007.
The reserve price is equal to the fair market value of RUB24.658 billion determined by an independent appraiser, with a price increment of RUB200 million, and the first increment of RUB342 million.
The auction will be arranged by OAO "Alfa-Bank", an Accredited Agent of RAO "UES of Russia", in accordance with the applicable Russian laws and pursuant to the RAO UES Board resolution of 9 February 2007.**
Both Russian and foreign legal entities and natural persons may take part in the auction. The auction participant that offers the highest price will be named the winner.
The Auction Notice (in Russian) may be viewed in the section Purchases and Announcements / Information about purchases and sales in OAO RAO "UES of Russia" on the Company's website.
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* OAO "WGC-5" comprises the Konakovskaya TPP, Nevinnomysskaya TPP, Sredneuralskaya TPP, and Reftinskaya TPP. The installed capacity of the company's power plants is 8,672 MW. WGC-5 shares were admitted to trading on ZAO "MICEX Stock Exchange", OAO "RTS Stock Exchange", and NP "RTS Stock Exchange" in September 2005. In autumn 2006, WGC-5 raised USD459 million, or RUB12.1 billion, through the public offering of 5.1 billion shares (which makes about 14.1 percent of the company's authorized capital). The offering proceeds will be used to finance the investment projects.
** The Board of Directors of RAO "UES of Russia" held on 9 February 2007, approved the sale of the 25.03% stake held by RAO "UES of Russia" in OAO "WGC-5" in order to attract a strategic investor and raise investments in the company and electricity sector. After the sale, the stake held by RAO "UES of Russia" in OAO "WGC-5" will decline to 50 percent from 75.03 percent.
Pursuant to the resolution of the Board of Directors of RAO "UES of Russia", the offering proceeds will be used to finance the investment programmes being implemented by OAO "UES FGC" and OAO "HydroWGC", and to create a reserve for the reorganization of RAO "UES of Russia".
Currently, corporate actions are underway to spin off OAO "WGC-5 " and OAO"TGC-5" from RAO "UES of Russia", which is part of the first stage of the Parent Company's reorganization. In this connection, at its meeting scheduled for 30 March, the Board Director of RAO "UES of Russia" will review the memorandum prepared with the involvement of an investment advisor on the best possible way to sell the WGC-5 shares and decide on the reorganization of WGC-5 with a view to maximizing return from the sale of WGC-5 shares.
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