SPFU Fighting Tooth And Nail Against Yuzhny GOK Capital Increase.

The State Property Fund has filed an appeal with the Kyiv Appeals Court, against the decision of the  Kyiv Civil Court which allowed an additional share issue at Yuzny GOK (YGOK: BUY). This is the second attempt: in mid-August the SPFU used the court to block the share issue when it was voted for at April?s AGM. The court ruling suspended the case until the Constitutional Court decides whether the Law on the Privatization Of Ukrrudprom (according to which Ukrainian GOKs where privatized last year) is legal. Should the Court decide the law was unconstitutional, the state will be able to take back its shares in many GOKs, including a 25.78% stake in YGOK. We doubt such a decision will be adopted. July?s EGM again voted for the capital increase which would triple statutory capital from USD 106 mln to USD 318 mln.