UPDATE 1 – Russia's Mechel to sell Ruse heating utility

SOFIA (Bulgaria), September 26 (SeeNews) – Russian steel producer Mechel said it plans to dispose of Toplofikatsia Rousse EAD -- the heating utility it operates in the Danube city of Ruse in Bulgaria.

According to Russian daily Kommersant (www.kommersant.ru), the Bulgarian company is offered for sale for $50 million (38.9 million euro).

The step is part of a restructuring programme aimed at improving the company’s financial performance and boosting its shareholder value, Mechel said in a statement on its website on Tuesday.

The decision was adopted by the company’s board of directors at a meeting on September 21.

“We reiterate that the revised strategy for Mechel OAO’s development envisions focusing on such priority areas as mining and full-cycle steelmaking with an emphasis on production of long products and high value-added products, including specialty steel, stainless steel and hardware,” the company said.

Assets to be sold also include Mechel’s Eastern European Steel Division SRL, Donetsk Electrometallurgical Plant PJSC (Ukraine), Invicta Merchant Bar Ltd (UK), UAB “Mechel Nemunas” (Lithuania), among others.

In order to speed up implementation of the mining division’s priority project — development of the Elga coal deposit — the board of directors also recommended evaluating the possibility of a potential divestment of a minority stake of no more than 25% in Mechel Mining OAO to a strategic partner.

($ = 0.7775 euro)