The main owners of U.K.-based Evraz PLC initiated the process of acquiring one of the largest coking coal producers in Russia, Sibuglemet Holding OOO, from state development bank VEB.RF, Russian business daily Kommersant reported Feb. 14.

The deal will be worth about 4 billion Russian rubles, according to the newspaper's sources, but the buyers will be responsible for servicing Sibuglemet's US$3.5 billion debt to the development bank.

Russia's Federal Antimonopoly Service received a request from Onega Holdings to acquire Sibuglemet's flagship Mezhdurechie asset in the Kuznetsk Basin, Kommersant reported, citing the antitrust body. Onega Holdings belongs to the holding companies of core Evraz shareholders Roman Abramovich, Alexander Abramov and Eugene Shvidler.

Evraz started managing Sibuglemet in 2015. The company's main Mezhdurechie property is a few miles across the Usa River from Evraz's Raspadskaya coal complex in Kemerovo Oblast in southern Siberia.

The structure of the deal will let Evraz maintain its debt and dividend levels, according to a same-day note from BCS Global Markets' analysts. The company had a net debt to EBITDA ratio of 1.1x as of June 30, 2019.

Evraz declined to comment to S&P Global Market Intelligence.

At the end of 2018, the company confirmed its strategic interest in Sibuglemet's coal assets in response to media speculation and noted that no decisions had been made.

Evraz's share price was down 1.56% in London as of market close Feb. 14.

As of Feb. 13, US$1 was equivalent to 63.35 Russian rubles.