SGOK EGM approves UAH 118 mln additional share issue

An EGM at Northern Iron Ore (SGOK UK) approved on Feb. 14 an additional share issue worth a total of UAH 118 mln (USD 13.9 mln). The newly issued 14.8 mln shares (0.6% of the current number of shares) will be allocated at close to the market price, around UAH 8/share. The aim of the issue is to fund construction of a crusher and conveyor system and finance general working capital projects, the company said.

Roman Topolyuk: The new shares foresee a minor share dilution (0.6%). Since the amount of the additional equity issued is around 4% of the estimated CapEx for the crusher and conveyor system (USD 315 mln), and a similar equity issue will be reviewed by an EGM at Central Iron Ore (CGOK UK) on Feb. 19, we think the underlying reason for the decision is some legal restructuring of Metinvest’s assets.