Ferrexpo to squeeze out PGOK minority shareholders

Ukraine’s largest iron ore pellet exporter Ferrexpo
(FXPO LN, FXPOLN) announced its intention to perform a squeeze out of the
minority shareholders at its main Ukrainian production asset, Ferrexpo Poltava
Mining (FPM, PGOK UZ), according to an Apr. 2 report by Interfax-Ukraine. As of
Apr. 1, 2019, Ferrexpo owned 99.12% of FPM shares, Interfax-Ukraine said.

The price at which Ferrexpo will buy the FPM shares
owned by the minority shareholders remains unknown. Interfax-Ukraine reported
that in March PGOK stock traded in a wide range from UAH 6.0 (USD 0.22) to UAH
26.5 (USD 0.97) per share.

Dmytro Khoroshun: The squeeze
out will be positive for Ferrexpo because it improves corporate governance by
eliminating the bureaucratic burden and legal risks attached to the current
quasi-public status of most Ukrainian companies, including FPM.

Within the squeeze out, Ferrexpo stands to buy 1.7
mln of FPM shares from the minorities. The total cost will be up to USD 1.7
mln, using the prices cited by Interfax-Ukraine, which will be a solid
investment for Ferrexpo.