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Antitrust service to delay action on Mechel - Kremlin aide

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The Federal Antimonopoly Service (FAS) sees Russian steel giant Mechel's cooperation as a positive sign and will take no action against the company for the time being, a presidential aide said on Monday.
MOSCOW, July 28 (RIA Novosti) - The Federal Antimonopoly Service (FAS) sees Russian steel giant Mechel's cooperation as a positive sign and will take no action against the company for the time being, a presidential aide said on Monday.

"The service will make a decision in due course. If the company is in breach of standing regulations... the FAS has the right to impose sanctions, and will do that if it has to," Arkady Dvorkovich said.

Mechel pledged on Friday to sell coking coal at the same price domestically and abroad, a day after Russian Prime Minister Vladimir Putin criticized the company for overcharging in Russia.

The company said it was ready to hold talks on price-fixing procedures with the authorities, and that it agreed with the Russian government's position that coking coal prices on the domestic market should not be higher than world prices.

Mechel shares plummeted 45.6 % as trading opened on the RTS stock exchange on Friday following Thursday's 33% plunge in the Russian ferrous metals company's ADRs on the New York stock exchange. Monday's results are expected later today.

"We hope recent events will be a lesson for both the Mechel company and the entire Russian market," Dvorkovich told reporters. He also urged all Russian companies "to act in the most civilized way."

The Kremlin aide also called for the Russian government to support public companies, which should in turn be "a specimen of corporate management and market behavior."

The stock of other Russian ferrous metals producers fell on the London Stock Exchange, where a lot of Russian metals are listed, following Putin's criticism of Mechel.

Metals companies listed on Russia's RTS and MICEX stock exchanges lost more than 5% on Friday morning.

Mechel CEO Igor Zyuzin, who controls 70% in the company, has been undergoing a medical examination at a Moscow cardiology clinic since Wednesday.

"He is still undergoing an examination at our clinic," said Irina Fedoseyeva, an aide to the head of the Moscow Medical Academy.

Vladimir Putin put pressure on the company on Thursday at a metallurgy conference in the Volga city of Nizhny Novgorod, saying Mechel had sold raw materials abroad in the first quarter of 2008 at half the price of domestic sales.

The premier said the Federal Antimonopoly Service and the Investigation Committee under the Russian Prosecutor General's Office should look into Mechel's activities.

In mid-June, Russia's antimonopoly regulator brought charges against Mechel's subsidiaries after several checks of coking coal markets.

Mechel has several metal processing plants in Russia, Romania and Lithuania. It unites producers of coal, ore, nickel, steel and highly-processed steel products for domestic and foreign markets.

In 2007, the company's output totaled 21.2 million metric tons of coal and 5.1 million tons of rolled products.

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