1 June 2010
On Monday, local internet resource Ukrainian Pravda reported that Ukraine’s sixth largest steelmaker Zaporizhstal (UX: ZPST UK) was sold to unnamed Russian investors. According to Ukrainian Pravda, selling price amounted to ~USD 1.7 bln. The source also reported that initially the selling agreement was signed with a Ukrainian investor (associated with Rinat Akhmetov, the owner of SCM), but the Russian bidder offered a higher price and the initial agreement was broken. Andriy Gerus: The stock soared 36% yesterday on the news on a UAH 1 mln volume, though we believe the volume included non-market technical transactions as well. We think that Zaporizhstal indeed was sold to Russian investors and view this news as generally positive long term as the new owners are likely to have resources and intent to implement a badly needed modernization of Zaporizhstal’s outmoded open hearth facilities.