Moscow, 12 September 2005. As part of the process to consolidate the subsidiaries of OAO "Fifth Generation Company of the Wholesale Electricity Market" (OAO "WGC-5"), the minority shareholders of OAO "Konakovskaya TPP" were invited to exchange their shareholdings for 2,868,000,000 shares in OAO "WGC-5". As a result, the stake held by OAO "WGC-5" in the authorized capital of OAO "Konakovskaya TPP" will increase to 88.7% from 51.4% as at the time when the offer was made.
The share exchange ratio is 19 ordinary shares in OAO "WGC-5" for 1 ordinary share in OAO "Konakovskaya TPP". The ratio calculation is based on the appraisal of the market value of shares of OAO "WGC-5" and OAO "Konakovskaya TPP" performed by the consortium of independent appraisers, OOO "Pacioli. Audit Company", ZAO "Tsentr Professionalnoy Otsenki" ("Professional Appraisal Center"), and OOO "Ko-Invest".
Thus, upon completion of the share exchange, OAO "WGC-5" has ceased to be a wholly-owned subsidiary of RAO "UES of Russia". RAO "UES of Russia" currently holds a 90,25% stake in the authorized capital of OAO "WGC-5".
In order to ensure liquidity of shares in the companies established in the course of electricity reform, the executive management of OAO "WGC-5" carried out a number of measures designed to float the shares of OAO "WGC-5" on the stock exchanges.
This week, shares of OAO "WGC-5" are expected to be included in the list of non-listed securities of ZAO "MICEX Stock Exchange" and the List of securities admitted to trading but not included in the Quotation Lists of NP "RTS Stock Exchange". WGC-5 unsponsored Global Depositary receipts (GDRs) will commence trading on the London Stock Exchange and the Frankfurt Stock Exchange on September 19th.
OAO "WGC-3" will be the next wholesale generation company to consolidate its subsidiaries and list securities on stock exchanges.
Today, the formation of all WGCs is being carried out in accordance with the schemes approved by the Board of Directors of RAO "UES of Russia" and according to schedule.
The resolution to establish of OAO "WGC-5" as a wholly-owned subsidiary of RAO "UES of Russia" was approved by the Board of Directors of RAO "UES of Russia" on 3 September 2004. The state registration of OAO "WGC-5" was effected on 27 October 2004 by the Inspectorate of the Ministry of Taxes and Levies of Russia in the city of Yekaterinburg, Sverdlovsk Region. Anatoly Bushin was appointed Director General of the Company.
Pursuant to Order of the Government of the Russian Federation No. 1254-r of 1 September 2003, the following companies were included in OAO "WGC-5": OAO "Konakovskaya TPP", OAO "Nevinnomysskaya TPP", the Reftinskaya TPP and Sredneuralskaya TPP.
The formation of OAO "WGC-5" is planned to be completed through consolidation of its subsidiary power plants by exchanging the shares in OAO "WGC-5" for the minority shareholders' shares in OAO "Konakovskaya TPP", which will be followed by a merger of OAO "Konakovskaya TPP" and OAO "Nevinnomysskaya TPP" with and into OAO "WGC-5".
On 24 June 2005, the Board of Directors of RAO "UES of Russia" approved a number of resolutions which paved the way for direct implementation of the share exchange and merger of the AO-power plants with and into OAO "WGC-5". It is planned to complete the share exchange at OAO "WGC-5" in Q3 2005 and the merger of the subsidiary power plants with and into OAO "WGC-5" by the beginning of Q1 2006.
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