On August 25, 2017, the shareholders of JSC Irkutskenergo will hold an extraordinary general meeting by absentee voting. The shareholders are asked to give consent to the lease of the Bratsk, Ust-Ilimsk and Irkutsk HPPs currently owned by JSC Irkutskenergo to the company’s wholly-owned subsidiary Telmamskaya HPP LLC and to the conclusion with the Lessee of a contract for the maintenance and upkeep of the leased power facilities during the lease period (agenda items 1-2), to approve the loan agreements made by the company in 2017 in which the Company acts as the lender (agenda items 3-4).
The API recommends voting against on all agenda items. The recommendation to vote against on agenda items 1-2 stems from the API’s view that the lease of the power facilities is economically imperfect for the Company and its minority shareholders, the negative voting recommendation on the other agenda items is motivated by the absence in the meeting-related materials of a proper rationale for the transactions these agenda items refer to and information on their possible effect on the Company (as recommended in sub-clause 4 of clause 10 in the ‘B’ section of the 2014 Corporate Governance Code).
Irkutskenergo’s controlling shareholder JSC EvroSibEnergo does not participate in voting on the first two agenda items: this company is recognized as a related party to the transactions since it also exercises control over Telmamskaya HPP LLC, one of the parties to the transactions. At the same time, Telmamskaya HPP LLC is not recognized as a related party and can vote on these agenda items