State Property Fund Insists KSTL Pay USD 88.7 mln in Dividends
25 October 2008
If it does not, the SPF is threatening to take Mittal Steel Kryvy Rig (KSTL: BUY) to court. According to SPF Chair Valentyna Semenyuk, the company owes the state USD 88.7 mln in dividends from a period when KSTL belonged to the state. Earlier this year, at its AGM on June 29, Mittal Steel Kryvy Rig decided to pay USD 64.7 mln to the state. Andriy Gostik: The SPF’s pressure on KSTL appears to have a political connotation, as the company’s previous owners are now well positioned to lobby their interests through governmental agencies. We do not believe, though, that the SPF’s actions pose a serious threat to Mittal’s ownership rights, as in this case Ukraine would have to reimburse the USD 4.8 bln that Mittal Steel paid for its stake in KSTL. On the other hand, in the worst case, KSTL can always opt to pay the shortfall of USD 22 mln that the SPF is demanding to avoid further disputes.
