Mechel To Request Share Issue

Mechel, the country's largest coking coal miner, said Friday that it would ask shareholders next week to approve a plan to revive a preferred share issue and that it would more than double the amount of shares on offer.

Mechel said it planned to issue up to 138.8 million preferred shares with a nominal value of 10 rubles each. Shareholders will vote on the plan at an extraordinary general meeting Monday.

The company, also Russia's sixth-largest steelmaker, did not say how much it hoped to raise if it made another attempt to list the shares, which it plans to issue as Global Depositary Receipts.

Likewise, it did not say when it might carry out the placement, and a company spokesman declined to comment on details of the issue.

In August, Mechel postponed the offering indefinitely, shortly after attacks by Prime Minister Vladimir Putin on its coal pricing policies and accusations of tax evasion wiped out half the company's value in three trading days.

The miner had originally planned to place up to 55 million preferred shares on Aug. 11 to raise more than $2.5 billion. Mechel's stock has fallen 88 percent since peaking in May.

Following Putin's comments and a subsequent anti-monopoly probe, Mechel agreed to cut domestic coking coal prices by 15 percent from Sept. 1 as part of a settlement with regulators, who also ordered the company to pay a fine equivalent to 5 percent of its 2007 coking coal revenues.