1. 1 Corporate governance practice London, 28th of February, 2004 Pavel G Skitovich Deputy General Director Strategy and Corporate Affairs

2. 2 Reorganization Process Stage 1 Establishing a holding company JSC “Power Machines” (completed in the middle of 2003) 1.Acquisition of shares of plants (subsidiaries) on the market by PM 2.Authorized capital increase by additional issue, which was paid by the plants’ (subsidiaries) shares Stage 2 Establishing a unified share for JSC “Power Machines” by the merger of all plants (completed in February 2004) 1.Approval of the reorganization decision. Approval of the reorganization agreement 2.Authorized capital increase by addition issue 3.Exclusion of the plants as a legal entities form the State Register 4.Insertion of changes into the Charter of PM

3. 3 Decision-making process Board of Directors: - Redemption share price definition - Approval of conditions feasibility and procedures of reorganization - Approval of the shares converting procedures General Meeting of Shareholders - Merger decision approval - Merger agreements approval - Authorized capital of JSC “Power Machines” increase. Additional issue approval Combined General Meeting of Shareholders (ZTL, LMZ, PM, Electrosila): - Insertion of changes into the Charter of PM

4. 4 Voting Results on the Question of Reorganization

5. 5 Shares redeemed under the shareholders’ requests

6. 6 Authorized capital structure of Power Machines Authorized capital – RUR 72 169 387,08 Nominal price of 1 ordinary share – RUR 0,01 Nominal price of 1 preferred share – RUR 0,01

7. 7 Interros with partners Siemens AG Minority shareholders LMZKTZ TzKTI >25% vot. >35% vot. >75% ZTL Electrosila 4,9% 75,4% 19,7% Power Machines structure before the reorganization

8. 8 Interros with partners Siemens AG Minority shareholders Production units (Electrosila, LMZ, ZTL) KTZ TzKT I 4,4% 2,6% Lenenergo 71% >25% vot. >35% vot. 22,2% Power Machines structure nowadays

9. 9 PM has to comply all the obligations to the EBRD loan agreement regard to corporate governance Placing of PM shares as a part of company restructuring process obliges PM to meet the requirements according to the “corporate governance best practice”: - high level of transparency - independent directors in the Board of Directors - maximum protection of the rights of shareholders - reliable registration of the property rights HSBC was acting as a financial adviser to the company during the secondary offering and was responsible for the communications with the investor community Corporate governance improving

10. 10  No actions which are designed to or may result in, the stabilisation, maintenance or manipulation of the share price  No announcements which may adversely affect the share price, without prior consent with HSBC  No share transaction without prior consent with HSBC  No capital reduction or public announcements about any intention to do so without prior consent with HSBC  Russian Trading System listing (category “B”) Obligations to the HSBC

11. 11  Incorporate compliance statement into the annual report for 2003 with a commitment to fully comply with the Corporate Governance Code by 2005  Approve own corporate governance code as part of the Company’s by laws in 1 st half of 2004  Establish an IR Department in 1 st quarter 2004  Establish an Audit Committee and Remuneration Committee of the Board of Directors in 2004  Commence producing semi-annual audits under IAS from 2 nd half 2004 Obligations to the EBRD PM commits to undertake the following measures with regard to corporate governance improvements:

12. 12 Merger with UHM

13. 13 ONSHORE & OFFSHORE NPPEQ** MINEQ**STEEL OTHER ASSETS OIL & GAS EQUIPMENT DRILLING TOOLS & TECHNOLOGY SHIP OFFHORE DESIGN PRESSURE VESSELS CRANESROLLS INSTRUMENTS OTHER  UHM is the largest Russian private heavy engineering corporation  UHM’s 2002 GAAP sales amounted to $435 million, a 39% increase over 2001.  The company has manufacturing and engineering facilities in Russia, USA, Romania and the Ukraine and sells its products to over 30 countries in the world  UHM is one of four Russian companies whose securities are listed on the London Stock Exchange  The Company’s shares are also traded on the RTS stock exchange in Russia * According to Listing Particulars dated 29.09.03 **NPPEQ – Nuclear Power Plant Equipment **MINEQ – Mining Equipment * UHM overview

14. 14  Power Machines Group is a leading Russian manufacturer and supplier of equipment for hydro, steam, gas and nuclear power stations, equipment for transmission and distribution of electricity as well as transportation and railway equipment  Power Machines 2002 IAS sales amounted to $276 million, a 13% increase over 2001  Enterprises within the Group include some of the largest manufacturers and suppliers of heat and electricity generation equipment such as Leningradsky Metallichesky Zavod, Electrosila, Turbine Blades Plant (St.Petersburg), Kaluga Turbine Works (Kaluga) Production units (Electrosila, LMZ, ZTL) KTZ TzKTI >25% vot. >35% Power Machines overview

15. 15 UHM minorities Uralmash Izhorskiye Zavody SpecStal Krasnoe Sormovo Other subsid. Interros with partners Siemens AG Minority shareholders Production units (Electrosila, LMZ, ZTL) KTZ TzKTI Management of UHM Treasury stocks (not voting) 4,4% 2,6% Lenenergo 71% >25% vot. >35% UHM and Power Machines (nowadays)

16. 16 The merger reasoning Major objective – creation of the large single national operator on the machines building market should lead through integration and synergy to a company value growth multiplied, as opposed to a share addition of both values Shareholders of PM are set to benefit from a large value growth potential hidden in UHM and PM business integration Interros takes all risks by swapping its shares on UHM shares, giving a free-of-charge option for the PM shareholders either to swap their shares or to keep shares of PM The final objective is to create an additional value for shareholders, based on UHM share Reasons for that – a longer history of UHM being a public company, a significant range of capital market instruments in operation (prime savings for PM shareholders)

17. 17 > 71% of Power Machines Subsidiaries of UHM Interros with partners UHM minorities Former PM minorities KTZ TzKTI PM’s minorities approx.41%* vot. Former management of UHM ? ? UHM-PM >25% vot. >35% Treasury stocks (not voting) *based on the scenario when 100% of PM’s minorities are swapped Expected holding structure of UHM-PM (end of 2004)

18. 18 Management of the new company  Mr. Yakovlev to be appointed as a CEO as of late Q1  Mr. Bendukidze to be appointed as a Chairman of the Board of Directors as of late Q1

19. 19  Communications with shareholders and investor community  Valuation of PM and UHM and their subsidiary companies  Capital structure of the company  General market intelligence and feedback  Providing advice in relation to the Russian and UK take-over rules  IR program of the company HSBC will assist PM on the execution of the merger Responsibilities of HSBC with respect to the merger: