July 3, 2019
PAO Severstal announces that it has signed an agreement to purchase a share in a joint venture (JV) with Germany’s Linde AG. The JV produces coil-wound heat exchangers for use at medium-scale and large-scale LNG plants. Upon completion of the transaction Severstal will control a 26% stake, and Linde a 74% stake in the joint venture.
The joint venture was set up in June 2017 under a scheme to localize the manufacturing of coil-wound heat exchangers within Russia. The plant will manufacture up to six coil-wound heat exchangers per year, including large-scale heat exchangers. The plant is expected to reach its full production capacity in 2020-2021.
The acquisition of the stake in the joint venture is fully consistent with one of the main approaches of Severstal’s updated strategy; closer cooperation with clients and providing them with customized solutions as a part of our strategy “Superior client experience”.
Alexander Shevelev, CEO of Severstal, commented:
“LNG production, storage and transportation is a key trend in the development of the energy sector, both in Russia and globally. Following this trend, Severstal has decided to enter a new high value-added product into this fast-developing market. Linde’s international experience in production, quality control and supply chain management, combined with Severstal’s many years of experience in manufacturing products and tailor-made solutions will enable the joint venture to provide our customers with integrated solutions and increase its share in the domestic market.”