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JSFC Sistema - Segezha Group acquires Lesosibirsk LDK No. 1

Mon 15th February, 2016 9:40am
RNS Number : 0644P
JSFC Sistema
15 February 2016

Segezha Group acquires Lesosibirsk LDK No. 1

Moscow, 15 February 2016. - Sistema JSFC (LSE: SSA, hereinafter - Sistema) announces that its subsidiary LLC LesInvest (part of Segezha Group) has acquired a controlling stake in OJSC Lesosibirsk LDK No. 1, the largest vertically integrated wood processing enterprise in Russia, based in Krasnoyarsk region.

Fyodor Potapenko, who has served for many years as head of Segezha Group's Sokol Wood Processing Plant, a producer of high-quality lumber and wood products for housing construction, was appointed as the new CEO of Lesosibirsk LDK No. 1.

The management of Segezha Group has already commenced integration of the Lesosibirsk plant into the Group and realisation of synergies with existing product lines.

Sergei Pomelov, President of Segezha Group, said: "The Lesosibirsk plant has favourable conditions for further successful growth: a significant forest resources base and modern logging and sawmilling capabilities. With the acquisition of this asset, Segezha Group has expanded its presence in Russia, and is diversifying its business geographically. By more than doubling the raw materials volumes processed at its sawmills, the group has become a leader in the production and sale of sawn timber in Russia. The product range offered to customers has been expanded by adding new types of wood that are in demand on the market: larch and Angara pine."

For reference

OJSC Lesosibirsk LDK No. 1, Krasnoyarsk region, is one of Russia's largest producers of lumber, fibre board, planed mouldings and furniture made of natural Angara pine wood. It has sold its products on the global forest products market since 1969 and has a reputation as a reliable partner. Lesosibirsk LDK No. 1 processes more than 1 million cu m of logs annually. The total annual allowable cut comprises 2.9 million cu m per year. In recent years the plant has modernized its drying facility and lumber and timber sorting lines, and a new sawmill has been built. Products are exported to Europe, North Africa and the Middle East. It is one of the largest enterprises in Lesosibirsk and supports 3.7 thousand jobs.

Segezha Groupis a vertically integrated international forest industry holding company that unites the logging and wood processing assets of Sistema JFSC since September 2014. Segezha Group comprises over 50 enterprises in Russia and seven other countries and employs around 10,000 people.

Segezha Group holds 15% of the paper packaging market in Europe and around 50% of the Russian market. The company is second in Europe for brown kraft paper production and third in the world for total kraft paper production. The company accounts for 12% of the Russian wooden-building construction market and 9% in beams and wooden structures.

Segezha Group is the largest forest user in the European part of Russia. The total area of its rented forest resources is around 5.5 million ha, including 5.2 million FSC certified ha (94%).

Segezha Group's sawmills, located in Karelia and the Arkhangelsk and Vologda regions, process around 1 mln cu m of logs and produce 470 thousand cu m of lumber annually. More than 95% of products are exported to markets in Northern Europe, the Baltics, Asia, North Africa and the Middle East.


For further information, please visit www.sistema.comor contact:

Investor Relations Public Relations

Yulia Katukova Sergey Kopytov

Tel: +7 (495) 692 22 88 Tel: +7 (495) 228 15 32

Sistema is a publicly-traded diversified holding company in Russia and the CIS, which invests in and is a major shareholder of companies serving over 100 million customers in the sectors of telecommunications, high technology, radars and aerospace, banking, retail, mass-media, tourism and healthcare services. Founded in 1993, the Company reported revenues of revenues of RUB 515.9 billion for the nine months of 2015, and total assets of RUB 1.2 trillion as at September 30, 2015. Sistema's global depository receipts are listed under the symbol "SSA" on the London Stock Exchange. Sistema's ordinary shares are listed under the symbol "AFKS" on the Moscow Exchange. Website:

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