Nikopol Ferroalloy's Privatization Canceled.

The Higher Economic Court ruled on August 26, 2005 that the privatization of the 50%+1 stake in Nikopol Ferroalloy (NFER: SELL) in 2003 violated the law. The stake was purchased by the Prydniprovya Consortium in two parts for a total of USD 77 mln. The Prydniprovya Consortium was created by a number of companies associated with the Interpipe group. Concorde Capital: NFER will likely follow Kryvorizhstal?s fate and be put up for a tender in the near future. Interpipe has little chance now to prevent this from happening so it will likely sell the 23% stake it purchased on a secondary market to the new strategic buyer of the 50%+1 stake. The potential buyers include Renova/ Abramov (Evrazholding?s key shareholder) and Privat group. However, NFER?s ownership issue is far from over. Meanwhile, despite its low liquidity the company?s stock price will be affected by speculations caused by the upcoming re-sale buzz.