Results of general meeting of JSC "Borly" (Kazakhstan) shareholders

/KASE, Jan.21, 00/ - According to listing requirements JSC "Borly" (Karagandy, official list of securities, category "B") provided Kazakhstan Stock Exchange (KASE) with the materials of shareholders general meeting, which was held on December 23, 1999. The meeting was opened by the chairman of the union committee of JSC "Borly" - Shpak V.I., who made clarifications to the shareholders about the matter on voluntarily reorganization of the company by joining it to OJSC "Corporation Kazakhmys", and which remains the main point in the agenda of the shareholders general meeting. On June 30, 1997 a contract was signed between the government of Kazakhstan and "Samsung Deutschland GmbH" (Schwallbah, Germany) to pass 80% of JSC "Borly" shares and 39% of state owned block of shares of affiliated joint stock companies to this company under the trust management for 3 years. On December 25, 1998 the managing company bought controlling block (98.01% of the authorized capital - comm. KASE) of JSC "Borly" shares, and on January 4, 1999 - state blocks of affiliated companies. By the general authorization of "Samsung Deutschland GmbH" JSC "Borly" and affiliated companies are managed by OJSC "Corporation Kazakhmys". Manager of JSC "Borly" (representative of "Samsung Deutschland GmbH") - Sergeev A.V. reminded the shareholders that the company was created on the base of State enterprise "Karagandauglerazrezy" and embodies four affiliated companies: AJSC "Razrez Kuu-Chekinskii", AJSC "Razrez Molodejnyi", AJSC "Nurinskoe PTU" and AJSC "Prishachtinskaya avtobaza". Presently, JSC "Borly" is a united production complex of technologically intertwined enterprises for uninterrupted extraction of coal and its delivery to the customers. Further it is said that with emergence of the managing company affiliated companies began to work steadily: inventory supply improved, barter deals were cancelled, coal is shipped on 100% prepayment terms based on signed contracts. As a result, cost per ton of extracted coal has decreased, which allowed the company to compete in energy market of Kazakhstan and to ship coal not only to power plants of OJSC "Corporation Kazakhmys", but also to others: Akmola, Almaty and Karagandy. Besides, thanks to the investments of the managing company a walking excavator was purchased for $1 mln and it is planned to put it into service in early January of 2000. Referring to these data, the manager of JSC "Borly" pointed out that by being under the management of OJSC "Corporation Kazakhmys" the company has significantly improved its results, however, for a stable work of affiliated companies of JSC "Borly" the company should be merged with OJSC "Corporation Kazakhmys". As a result of a merger JSC "Borly" will lose its status of a legal entity and will become a structural subdivision of OJSC "Corporation Kazakhmys" and in return it will receive a world-know name, direct low interest investments, expansion of social benefits of the workers of OJSC "Corporation Kazakhmys", and its direct protection. According to preliminary technical and economic ratios, presented by JSC "Borly", the company has achieved following results in 1999: - volume of ores reached 11.91 mln cubic meters or 103.3% of the plan; - coal production - 5.91 mln tons or 101.9% of the plan; - mining works - 8.36 mln cubic meters or 103.3% of the plan; - coal shipments - 5.98 mln tons or 106.7% of the plan; - coal sales - 6.00 mln tons or 107.0% of the plan; - sales proceeds - KZT2.36 bln or 121.3% of the plan. According to the agenda of the meeting the shareholders made the following decisions: - reorganize JSC "Borly" by joining it to OJSC "Corporation Kazakhmys"; - approve the merger agreement and transfer acts; - authorize the manager of JSC "Borly" - Sergeev A.V. to sign the merger agreement, transfer act and other supplements. On the same day (December 23, 1999) General meetings of the shareholders of affiliated joint stock companies of JSC "Borly" were held, where the decisions were made to merge with OJSC "Corporation Kazakhmys".