03.08.2011
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Results of the Board of Directors Meeting

JSC RusHydro (ticker symbol: RTS, MICEX, LSE: HYDR; OTCQX: RSHYY) announces the results of the Board of Directors meeting that was held August 2, 2011.


Key highlights:

-   The Board approved the price of additional shares of RusHydro to be placed at RUR 1.65 per share;

-   The Board approved the valuation of a number of assets accepted as payment for shares of the new issue;

-   The Board approved a new version of the Innovations Development Program of RusHydro for 2011-2015;

-   The Board approved setting up a new company to develop the project of Severnaya tidal power plant in the Murmansk region;

-   The Board approved the total cost of R&D and experimental development works at Severnaya tidal power plant at RUR 7.5 bln.

***


The Board of Directors approved the price of additional ordinary shares of RusHydro (including for pre-emptive buyout) at RUR 1.65 per share. The valuation of shares was done by an independent appraiser - LLC Institute for Enterprise Issues (St. Petersburg).


The Annual General Meeting of shareholders of RusHydro approved an increase of the Company's authorized share capital by issuing 89,000,000,000 additional ordinary shares with a par value of RUR 1 per share on June 30th, 2011. The Board of Directors approved a decision on additional share issue and Prospectus of the issue on July 29, 2011.


***

The Board of Directors also approved valuations of shares of the following joint stock companies that will be accepted as payment for shares of the new issue:


Company

Type of shares

Price per share

(RUR)

JSC Boguchanskaya HPP

ordinary

5.9462454973676

JSC Boguchanskaya HPP

preferred

5.9462454973676

JSC Geoterm

ordinary

13.1746031746032

JSC Zaramagskiye HPPs

ordinary

0.0000129870129

JSC KamGEC

ordinary

0.4461589166171

JSC Pavlodolskaya HPP

ordinary

39.3804148070360

JSC Ust'-Srendekanskaya HPP

ordinary

1.3115530454084

JSC Kolymaenergo

ordinary

1.0208442229071

JSC Trest Hydromontazh

ordinary

11.3340717652817

JSC Trest Hydromontazh

preferred

11.3340717652817

JSC Irkutskenergo

ordinary

25.9591578793392


The Board of Directors also approved valuations of hydro-engineering facilities that that will be accepted as payment for shares of the new issue:


Facility

Valuation (mln RUR)

right-bank dam of Bratskaya HPP

499

left-bank dam of Bratskaya HPP

442

Dam of Ust'-Ilimskaya HPP

5,829

right-bank dam of Irkutskaya HPP

699

left-bank dam of Irkutskaya HPP

119


JPMorgan and Morgan Stanley provided opinions to the Board of Directors of RusHydro regarding the valuations of the assets listed above.

 

Valuations of shares of JSC RAO Energy Systems of East, JSC DEK, JSC Yakutskenergo, JSC Sakhalin Energy Company that will be accepted as payment for shares of the new issue, will be approved by the Board at one of the next meetings.


***

The Board of Directors approved the new version of 2011-2015 Innovations Development Program (with an outlook till 2021).


In particular, the document includes: report on the technological audit and its conclusions, scheduled events in foreign economic scientific and technological cooperation, a supplemental list of target indicators to estimate the efficiency of Program implementation and detailed information on RusHydro's participation in technological platform activities.


The new version of the document was developed under instruction execution based on results from a meeting of the Presidential Commission for the Modernization and Technological Development of Russia's Economy (January 31st, 2011), and taking into account methodological materials for developing innovations development programs for joint stock companies with State participation, state corporations and federal state unitary enterprises, as approved by a Decree of the Russian Ministry for Economic Development.


The new version was approved by the Russian Ministry of Energy, the Russian Ministry for Economic Development and the Ministry of Education and Science with no remarks, and was approved by a Working Group to develop private-state partnership in an innovative field at the Presidential Commission on High Technologies and Innovations.


***

The Board of Directors instructed the representative of RusHydro in Boards of Directors of JSC Leningrad PSPP and JSC HydroInvest (100% subsidiaries of RusHydro) to vote in favor of the decision to set up LLC Innovative Center of Tidal and Wave Energy RusHydro. The company's authorized capital will be RUR 500 thousand, which will be paid in cash by JSC Leningrad PSPP (RUR 495 thousand or 99%) and JSC HydroInvest (RUR 5 thousand or 1%) that will assume pro-rata ownership of the new company.


The Innovative Center of Tidal and Wave Energy RusHydro will be an operator of the experimental project to develop a Severnaya tidal power plant in the Barents sea. The aim of the project is to study the feasibility of the development of an 8 GW Mezenskaya tidal power plant in the White Sea with the annual generation of 38 TWh of electricity which is comparable to generation of the whole Volga-Kama cascade of hydropower plants of RusHydro.


The development of the project is provided in the current investment plant of RusHydro approved by the Board of Directors. RusHydro's R&D institute - JSC NIIES - has designed and developed unique equipment that will be used for the project of Severnaya tidal plant.


***

The Board of Directors instructed the representative of RusHydro in JSC NIIES to vote in favor of the approval of cost of R&D experimental and experimental development works for the project of Severnaya tidal power plant at no more than RUR 7.5 bln. The project should be completed in 4 years.





The information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of RusHydro. You can identify forward looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might," the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially from these statements. We do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with operating in Russia, rapid technological and market change in our industries, as well as many other risks specifically related to RusHydro and its operations.
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