Publication of information concerning plans for managing the SIJ d.d. investment in Perutnina Ptuj d.d. after the capital increase

Ljubljana, Friday, 30 October 2015 – Publication of information concerning plans for managing the SIJ d.d. investment in Perutnina Ptuj d.d. after the capital increase

SIJ – Slovenian Steel Group, d. d., would like to inform the public that following the approval of the General Assembly of the capital increase in Perutnina Ptuj d.d. – at the meeting of the General Assembly held on 31 August 2015, 98.86% of the present shareholders with the right to vote voted in favor of the capital increase – and after obtaining the necessary regulatory permits, the EUR 40 million capital increase was paid today.  In accordance with the current Takeovers Act (ZPre-1), SIJ d.d. will also submit a takeover bid for the purchase of the remaining shares in Perutnina Ptuj d.d.

By submitting the bid for a capital increase in Slovenia's largest meat processing company, SIJ d.d. was pursuing its goal of gradually diversifying the Group's operations. As clearly evidenced by the Group's business results – for the second consecutive year, the SIJ Group has recorded one of the world's highest EBITDA margins of any steel group, and has achieved an added value per employee that is 60% higher than the industry average in Slovenia – the SIJ Group can serve as a prime example of successful business and financial restructuring in the industry sector, not just in Slovenia but in the entire region. On top of that, the majority strategic owner has plans for the Group's development that are exclusively long-term in nature, and correspond with the reindustrialization development plans of its second largest shareholder – the Republic of Slovenia.

With this in mind, the SIJ Group’s management firmly believes that its extensive experience in business and financial restructuring, including the introduction of effective policies of corporate group management, can make an important contribution to the continued successful development of Perutnina Ptuj as a member of the SIJ Group.

While responses to the capital increase in Perutnina Ptuj by the SIJ Group have been mostly positive, financial markets highlighted some other aspects which point towards the SIJ Group moving to  the category of "financial holding companies" after the implementation of the capital increase in Perutnina Ptuj d.d.; however, this is something that the SIJ Group has never been and has no intention of becoming. SIJ d.d. will continue to operate as the controlling company of the group, actively and directly managing the affiliated companies and providing centralized guidance, harmonization and management of the key areas of the Group's operations.

Considering the new circumstances, the company's Management Board has prepared a proposal for the future management of the investment in Perutnina Ptuj d.d., first and foremost eliminating the risk of defining the SIJ Group as a "financial holding company". The proposal plans for the spinoff of the investment in Perutnina Ptuj d.d. to form a separate, new company (in accordance with Article 623 of the Companies Act), preserving in it the same ownership ratio as in SIJ d.d. – including a 25% share of the Republic of Slovenia, managed by the Slovenian Sovereign Holding (SDH).

In order to achieve the spinoff of the investment, SIJ d.d. will have to obtain permission from the owners of SIJ2 and SIJ3 bonds to amend certain terms and conditions of bonds, as also approval of the Supervisory Board, and the company shareholders; these processes will be launched immediately after the capital increase has been paid. The SIJ d.d. Management Board believe that the spinoff will enable the uninterrupted development of both activities and the separate financing of both areas, while also giving the two largest SIJ Group shareholders direct influence over the supervision of operations and the implementation of strategies in both activities.

The SIJ d.d. corporate governance bodies will continue to act with full transparency in these processes, ensuring their legality as well as the consideration of the legitimate interests of all key stakeholders, i.e. all shareholders, creditors and employees.


 The SIJ Group is the largest Slovenian vertically integrated metallurgist group, ranked among the top market positions in the European and world niche steel markets. The Group comprises five business areas, has 23 affiliated companies in Europe, the USA and Asia, and employs some 3,200 people.

In 2014 the SIJ Group generated EUR 707.8 million in revenues, a 7% increase in comparison with 2013. Profitability also significantly increased, since the EBITDA increased by 91% reaching EUR 77.8 million. The 11% EBITDA margin that was achieved put the SIJ Group among the most successful world steel producing groups in 2014. The EBIT amounted to EUR 39.6 million and increased by 18 times in comparison with 2013, and net profit was slightly less than EUR 25 million.