Ferrexpo to sell its Brazilian investment for USD 42 mln
30 April 2015
Ukraine’s leading iron pellet exporter Ferrexpo (FXPO LN, FXPOLN) reported on April 30 that it has agreed to sell its 15.5% stake in Brazilian iron ore miner Ferrous Resources Limited for a total cash consideration of USD 41.8 mln. Ferrexpo purchased Ferrous in a series of deals in 2013, for a total price of USD 82.4 mln.
As of end-2014, Ferrexpo has fully impaired its investment in Ferrous and posted respective losses from the impairment in its 2014 P&L. If completed, the deal would add about USD 42 mln to Ferrexpo’s bottom line in 2015.
Alexander Paraschiy: While the company is going to exit Ferrous with a 50% discount to its entry price, the deal seem to be in the market. For comparison, share prices of pure ore miners, like Ferrexpo or Fortescue (FMG AU), also halved since September 2013, when Ferrexpo was buying the Brazilian asset.
