September 12, 2012 / 1:40 PM / 5 years ago

Alrosa sells 51 percent in Timir iron ore project to Evraz

MOSCOW (Reuters) - The supervisory board of Russian state-run diamond miner Alrosa approved a deal to sell a 51 percent stake in Timir iron ore project in Eastern Siberia to the country’s largest steelmaker Evraz (EVRE.L), the company said on Wednesday.

Russia’s state development bank VEB will own one share, according to the statement, and obtains a priority option to acquire shares in Timir in the future.

Alrosa bought the rights to develop four deposits of iron ore in the south of Yakutiya region for $173 million in 2008 and united them into the Timir project.

    The company valued the project at $10 billion, saying it would require $3 billion in investments at the initial stage.

    The decision to attract a partner to develop the deposit was announced last September. Alrosa said earlier it was in talks with Evraz and unidentified foreign firms to join the project.

    Evraz said in March that it could invest up to $1.5 billion in Timir in five years.

    Reporting By Alexei Anishchuk and Andrei Kuzmin; Editing by Melissa Akin

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