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Mon December 17 2018

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SSAB offloads Ruukki's Russian business

15 Nov SSAB has completed the transfer of Ruukki Construction’s business operations in Russia to a local company.

The finalisation of the deal with Russian company OAO Salavatneftemash - first announced in July - follows the receipt of approval by the Russian competition authorities.

The transaction excludes the right to the Ruukki brand.

Ruukki Construction’s divested business operations in Russia had sales of approximately SEK400m (£33m) in 2017; Ruukki Construction’s total sales last year were about SEK5.8bn.

The production facilities transferred in the transaction are located in Obninsk and Balabanova in the Kaluga region.

“We can now focus on growing our market share in our current main market areas in the Nordics, Baltics and in Central Eastern European countries,” said Ruukki Construction president Sami Erone. “Our strategy is to pursue profitable growth in our product businesses, Residential Roofing and Building Components. In the project business, Building Systems, we want to further improve profitability by developing our project and product portfolio. Our business operations in Russia were fully independent and so the transaction has no implications for our operations in other countries.”

Ruukki Construction’s business operations in Russia employed a total of some 630 people. About 45 employees in the roofing business are not being transferred under the transaction. Ruukki Construction had a total about 2,500 employees before the deal.

An expected loss of SEK213m on the divestment was identified in the company’s report for the third quarter of 2018; completion of the transaction has not greatly changed this amount, said SSAB.

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