Ferrexpo acquires Danube transportation company Helogistics

Yesterday Ferrexpo (FSE: FXPO LN) announced in a press release that it acquired 100% of the share capital of Helogistics, one of the largest inland waterway transportation companies operating on the Danube River. The company transports iron ore pellets and other bulk cargo along the Danube River from Ukraine to various locations in Europe. In 11M10 Helogistics transported approximately 575,000 mt of Ferrexpo’s pellets to its core customer in Central Europe. According to Ferrexpo Chairman Michael Abrahams, this acquisition allows the company to further control its supply chain, providing access to new European markets. As of June 30, 2010, Helogistics had outstanding debt with a syndicate of banks of EUR 72 mln. Ferrexpo felt the debt was only worth EUR 28.5 mln and after negotiating with the banks, the banks agreed to reduce the debt to EUR 28.5 mln. Ferrexpo then repaid the debt off in cash. Ferrexpo bought 100% of the share capital of Helogistics for EUR 1.