Uralkali sells bonds to Chinese sovereign wealth fund

According to Reuters (11 November 2012), Uralkali has sold convertible bonds to Chengdong Investment Corporation and VTB Group worth an estimated USD 3 billion. The bonds, which mature in 2014,may subsequently be converted into shares, equivalent to 14.5 per cent of the potash producer.

Chengdong Investment Corporation is a subsidiary of Chinese Investment Corporation, a sovereign wealth fund. If converted into shares, Chinese Investment Corporation could end up owning 12.5 percent of Uralkali, with VTB receiving a 2 per cent interest.

The bonds were sold by four of Uralkali’s main shareholders owing over 45 per cent of the potash producer – Suleiman Kerimov (18 per cent), Filaret Galtchev (10.83 percent) and Zelikhman Mutsoev (8.3 per cent) and Anatoly Skurov (8.01 per cent).

Alexander Nesis, who owns 9.94 per cent of the potash producer, did not participate in the bond transaction.

Uralkali merged with another Russian potash producer Silvinit in 2011.

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