Solikamsk Magnesium Plant

Performance indicators

2023: Decrease in annual revenue by 4.9% to RUB 12.41 billion

At the end of 2023, the Perm enterprise Solikamsk Magnesium Plant (SMZ), the oldest magnesium producer in Russia, received revenue of approximately 12.41 billion rubles. This is 4.9% less than in 2022, when the figure was 13.05 billion rubles. Such figures are given in the financial report published in early March 2024.

The net profit of the plant in 2023 was recorded at 753.26 million rubles. For comparison: a year earlier, SMZ showed a net profit of 3.51 billion rubles. Thus, the fall in this indicator was about 78%. The report says that the total financial indicator of the year is approximately 1.15 billion rubles. This figure, in addition to profit from sales, includes funds from the revaluation of non-current assets of the enterprise by 400 million rubles. At the same time, profit from sales on an annualized basis decreased by about 6.5 times: if in 2022 it amounted to 4.01 billion rubles, then in 2023 - 619.4 million rubles.

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In 2023, SMZ, which produces magnesium and rare metal products (niobium, tantalum, titanium and some other), sold magnesium and its alloys in the amount of about 5.21 billion rubles. Revenue from the supply of rare earth carbonates, niobium, tantalum and titanium compounds was recorded at around 4 billion rubles. Most of the rare trucks were shipped abroad: in total, the export volume amounted to approximately 2.49 billion rubles.

The report also says that the long-term obligations of SMZ increased from 581.7 million rubles as of the end of 2022 to 603.5 million rubles at the end of 2023. Short-term liabilities increased on an annualized basis from 2.1 billion to 2.4 billion rubles. Payables rose from 1.7 billion to 1.8 billion rubles, receivables - from 1.4 billion to 1.7 billion rubles.^[1]

History

2024: Recovery of shares in favor of the Russian Federation

The Arbitration Court of the Perm Territory satisfied the claim of the prosecutor of the Kama region to claim in favor of the state the remaining shares of Solikamsk Magnesium Plant OJSC (SMZ), owned by more than 2,000 minority shareholders, including individuals. The press service of the court announced this on March 22, 2024.

From the statement published in the Telegram channel of the Arbitration Court of the Perm Territory, it follows that the claims are based on the illegal disposal of federal property from the possession of the state, since the privatization of the state SMZ was carried out without the necessary decision of the Government of the Russian Federation.

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Earlier, the Prosecutor General's Office, acting in the interests of the Federal Property Management Agency, through the court secured the seizure in favor of the Russian Federation of 89.5% of the shares of SMZ owned by four large individual shareholders: Sergei Kirpichev (15.45%), Peter Kondrashev (24%), Timur Starostin (25%) and Igor Pestrikov (25%). The appeal and cassation instances confirmed these decisions.

The Moscow Exchange previously criticized the expected seizure of SMZ securities from private investors. The site believes that such a measure may contradict the legislation on organized trading. She was involved in the case as a third party. With reference to the Civil Code, the Moscow Exchange noted that "non-documentary securities certifying only the monetary right of claim, as well as non-documentary securities acquired at organized trading, regardless of the type of certified right, cannot be claimed from a bona fide acquirer."

By March 2024, the Solikamsk Magnesium Plant produces magnesium and rare metal products (niobium, tantalum, titanium and some other). The authorized capital of the plant is 99.568 thousand rubles, it consists of 398.272 thousand ordinary shares with a par value of 0.25 rubles, Interfax clarifies. ^[2]

2023: Rosatom becomes new owner of Solikamsk Magnesium Plant

In December 2023, Prime Minister Mikhail Mishustin signed an order to transfer the Solikamsk Magnesium Plant (SMZ) to Rosatom.

As specified in the document, the federally owned 356,276 shares of SMZ will be transferred to Rosatom as a property contribution of the Russian Federation at their nominal value. The Cabinet of Ministers instructed the Federal Property Management Agency and Rosatom to carry out the transfer of shares within six months.

Mikhail Mishustin signed an order to transfer the Solikamsk Magnesium Plant (SMZ) to Rosatom

According to Alexey Shemetov, First Deputy of JSC Atomredmetzoloto, specialists of the Mining Division of Rosatom, which will include SMZ, will carry out all the necessary procedures for corporate integration of a new enterprise into the division.

A lot of joint work is ahead on the implementation at the plant of uniform industry standards, regulations and corporate culture of Rosatom. Our strategic task is to ensure the full raw materials independence of high-tech industries of the Russian industry with rare earth metals, he said.

Solikamsk Magnesium Plant is a unique enterprise for Russia that produces rare earth elements and processes rare earth mineral raw materials.

Government of the Russian Federation Order of December 8, 2023 No. 3525-r

2022: Seizure of shares from several owners in favor of the state

On May 11, 2022, the arbitration court fully satisfied the claims of the Russian prosecutor's office on the arrest of shares of Solikamsk Magnesium Plant OJSC in favor of the state from several owners - Peter Kondrashev, Igor Pestrikov, Sergey Kirpichev and Timur Starostin.

In October 2022, Registrar Intraco JSC transferred more than 89% of its stake in Solikamsk Magnesium Plant OJSC to the balance sheet of the Federal Property Management Agency.

After the state received the main part of the SMZ back into ownership, the prosecutor's office of the Perm Territory asked the court to seize the remaining 10.6% of the shares from minority shareholders. Of this share, 2.35% is owned by the Region group of companies, Vedomosti wrote.

2021: Prosecutor General's Office filed a lawsuit to nationalize the enterprise

In October 2021, the Prosecutor General's Office of Russia filed a lawsuit to claim shares of the Solikamsk Magnesium Plant in favor of the state.

The prosecutor's office demands to withdraw in favor of the state 89.5% of the shares owned by Sergei Kirpichev (15.45%), who fled from Russia, Peter Kondrashev (24%, located in Austria), Timur Starostin (25%) and Igor Pestrikov (25%, are pledged to Kondrashev).

As a justification, the lawsuit states that the privatization of the plant in 1994-96 was carried out in violation of the legislation in force at that time. As a result, the enterprise dropped out of the property of the Russian Federation "in addition to its will" and "is currently in someone else's illegal possession," the Prosecutor General's Office argues.

Similar actions can be taken with respect to the Lovozersky mining and processing plant.

Notes