Fortum participated in a share auction conducted on 28th February to acquire a
controlling stake in the listed Russian TGC-10. The key financials of TGC-1 are
as follows:
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| MEUR | Last twelve | 2006 | 2005 |
| | months (LTM) as | | |
| | of Q3/07 | | |
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| Sales | 590 | 493 | 430 |
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| EBITDA | 55 | 42 | 55 |
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| EBIT | 26 | 15 | 29 |
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| Net profit | 12 | 8 | 19 |
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| Balance sheet | 677 | 574 | 542 |
| total | | | |
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| Interest-bearing | 61 | 40 | -3 |
| net debt | | | |
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Fortum expects that the transaction will be earnings diluting for two years.
The total consideration, EUR 1.7-2.7 billion, is to be financed with long-term
bank loans. Fortum's pro forma net debt/EBITDA will be around 2.8x at
acquisition assuming Fortum will reach 100% ownership of TGC-10. Fortum's offer
per TGC-10 share was 111.8 rubles.
On a pro forma basis, key features of Fortum's capital structure following the
transaction are:
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| | Current 1) | Pro forma 2) |
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| Capital employed | 13,544 | 16,412 |
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| Interest-bearing net debt | 4,466 | 5,954 |
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| EBITDA | 2,298 | 2,353 |
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| Adjusted net debt/EBITDA | 2.2 | 2.8 |
| 3) | | |
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1) Fortum 2007
2) Pro forma is based on full-year 2007 of Fortum and LTM Q3/2007 of TGC10
assuming 100% ownership based on bidding price.
3) Based on EBITDA excluding capital gain from sale of Fortum's holding in
Lenenergo amounting to 232 MEUR.
Fortum Corporation
Maria Romantschuk
SVP, Corporate Communications
Further information:
Mikael Lilius, President and CEO, Fortum Corporation, +358(0)10 45 29100
Tapio Kuula, Senior Vice President, Fortum Corporation, +358(0)10 54 24112