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Due to the sale of Tikhvin Ferroalloy Plant and Voskhod Mining Plant in late 2013, the company’s Board of Directors decided to reorganize the Group’s administrative structure by eliminating the ferroalloy division. As part of the reorganization process, Bratsk Ferroalloy Plant will be managed by the steel division (Mechel-Steel Management Company OOO). Southern Urals Nickel Plant, halted since December 2012, will be managed directly by Mechel OAO. Mechel-Ferroalloys Management Company OOO, the division’s management company, will be liquidated.

In 2012, Mechel OAO’s Board of Directors approved a development strategy that prioritizes mining and full-cycle steelmaking with a stress on manufacturing high value-added products (long rolls, specialty steels, stainless rolls and hardware).

“In order to cut down management personnel costs and due to a significant reduction in workload as several ferroalloy assets were sold and Southern Urals Nickel Plant OAO was halted, we decided to liquidate Mechel-Ferroalloys Management Company OOO. This decision logically follows from implementing our labor efficiency improvement program by optimizing management structures, which we approved in 2008. Thanks to our efforts in this field, we managed to reduce our administrative staff by over 3,000. The new administrative model will enable us to significantly cut personnel costs and ensure a more efficient mechanism for decision making,” Mechel OAO’s Chief Executive Officer Oleg Korzhov said.