MMK announces launch of forced GDR conversion process

PJSC Magnitogorsk Iron & Steel Works (“MMK”, the “Group”) (MOEX: MAGN, LSE: MMK) announces that it has initiated the forced conversion of its Global Depositary Receipts (“GDRs”), with GDR holders to submit applications for their conversion.

In line with Article 4 of Federal Law No. 319-FZ On Amendments to Certain Legislative Acts of the Russian Federation (“Law 319-FZ”), which took effect on 14 July 2022 (the “Effective Date”), MMK GDR holders have the right to submit an application to convert their GDRs into MMK shares (an “Application”) to AO Citibank, the depository bank managing the depository programme’s custody account, within 90 days of the Effective Date, should the following conditions outlined in Law 319-FZ be satisfied:

·         The GDR holder’s rights to their GDRs are recorded by a foreign organisation;

·         The GDR holder, or the person for whose benefit the holder acts, cannot receive the shares due to restrictions imposed on them and/or related individuals, or on foreign organisations recording their rights to the GDRs.

Each Application must be accompanied by documents available under the given circumstances and evidencing:

·         the number and ownership of the respective GDRs;

·         that the applicant’s claim is valid and legitimate; and

·         information about the foreign nominee holder recording the holder’s rights and about higher nominee holders.

Within 10 business days of the Application deadline (12 October 2022 – 26 October 2022), AO Citibank will open a holder custody account for the applicant, debit the appropriate number of MMK shares from the depositary programme’s custody account, and credit said shares to the applicant’s custody account.

Should there be reasonable doubt as to whether information in the Application is accurate and/or has been withheld, or should the Application include insufficient accompanying evidence, AO Citibank may refuse to open a holder’s custody account and credit the corresponding number of MMK shares to said account.

Should the total number of MMK shares claimed through the forced conversion process exceed the number of MMK shares held in the depositary programme’s custody account, no conversions will take place.

In all other cases, the automatic GDR conversion process outlined in Law 319-FZ and with due consideration to the Resolution of the Bank of Russia’s Board of Directors dated 22 July 2022, will apply. MMK will inform GDR holders through a separate press release when the automatic GDR conversion process begins.

In light of the above information, MMK encourages GDR holders to contact AO Citibank directly as per Law 319-FZ.

In addition, MMK reminds that from May 25, 2022, the procedure for exercising the rights of GDR holders under the Deposit Agreement continues to apply (https://mmk.ru/en/press-center/news/mmk-notifies-of-removal-of-its-global-depository-receipts-from-the-london-stock-exchange-official-li/).