Ferrexpo Poltava Mine contested stake frozen by court .

Ferrexpo Poltava Mine contested stake frozen by court .



5 квітня 2013 года
Конкорд Капитал

Ferrexpo (FXPO), Полтавский ГОК (PGOK)


A Kyiv court ruled on Mar. 26 to forbid any changes to the shareholder register of Poltava Iron Ore Mine (PGOK UK), the 97.3% subsidiary and the key asset of Ferrexpo (FXPO LN), Interfax reported on April 4. No shares can change hands in the ongoing court battle in which Aleksandr Babakov is trying to cancel a deal in which he sold his 40.2% stake in the Poltava Mine in 2002 to Kostyantyn Zhevago, Ferrexpo’s biggest shareholder. He also wants to cancel the subsequent capital increases in PGOK and return his number of shares in the company to pre-deal levels.

Roman Topolyuk: The ruling suggests the court case, which otherwise could have lasted for ages, is entering its active stage, and a final ruling is not far away. In the worst case scenario, Ferrexpo’s stake in Poltava Mine will decrease to 57%. Even in this case, Ferrexpo will still be able to fully control the enterprise and its cash flows, through some hurdles for Ferrexpo to keep total control may emerge. For instance, it’s Ferrexpo that currently accumulates most of the profit generated by the pellets of the Poltava Mine (which is selling them to parent Ferrexpo at a 26-28% discount to the market, we estimate). The entrance of a new, large shareholder to the Poltava Mine will put under risk this type of profit distribution, with most of it likely to be retained in Ukraine. In turn, that should increase Ferrexpo’s consolidated income tax burden and “minority interest” terms.
http://www.fixygen.ua/rs/companiesreviews/6680/

Источник: Конкорд Капитал

Аналитик: Роман Тополюк
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