Surprisingly, on Feb 2, 2007, the Board of Directors of NKNH and the major shareholder TAIF (75.6% of voting stock) changed its decision and confirmed the additional emission of shares in the amount of more than 1 bln dollars.
NKNH declared a new program of company development that would almost triple the revenue. That’s why NKNH needs more resources for re-modernization of equipment and purchase of new lines. Some analysts are very skeptical, although, say that would like to see more details first. There are no details yet. But what is clear that minority shareholders would lose more than a half of their value unless they’d buy more shares.
To be continued..
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This raises the level of intrigue even higher! Is it possible the politically connected owners could be attempting to grab what they can before national elections? Can the company perhaps really be expanding capacity in order to meet increased supply from oil fields coming on line in Siberia and the Arctic? Are they perhaps looking to export more or try to meet demands of the growing internal economy. I assume their in one of the "40" protected industries.
All these are could be the factors. However, 75.6 ownership is an "absolute control" over a company. All 4 major decisions that are within the only shareholder meetings power could be made. 10% stake in a company allows shareholders to demand an "unplanned" annual shareholder's meeting and cause "an inconvenience" to a major shareholder. 5% stake - demand for an audit. So, likely, NKNH is looking for a real business improvement and development and it's unfortunate for the minor shareholders.
Do they have any domestic competitors in the same league as far as size?
Not many, NKNH makes more than 50% of all 130-140 products that are produced in Russia.
Business people are acting similar in Russia and the US..
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