Yefimov to officially purchase Donbasenergo in six months

Maksym Yefimov, an MP of the Poroshenko Bloc, will become
the official owner of power generation company Donbasenergo (DOEN UK) within
the next six months, he told the epravda.com.ua news site in an interview
published on Aug. 20. Recall, the same news site reported in July, citing
anonymous sources, that Yefimov is close to purchasing a
60.8% stake in the company from Energoinvest-Holding, a firm that Ukrainian
media have reported is related to the son of former president Viktor
Yanukovych.

Yefimov told  epravda.com.ua that he is going to
convert the only power unit of Donbasenergo (the 800MW unit of the Slovianska
Power Plant) to burning hard coal from anthracite. Also, he is going to
construct a new power unit at the plant of 800MW capacity, expecting to spend
about USD 800 mln for the project. Of that amount, he expects that 30% will be
covered by a special “investment” markup to Donbasenergo’s power rate.

Alexander Paraschiy: If Yefimov
officially declares his ownership over Donbasenergo, its minority shareholders
will get an option to sell their shares at a price which is the higher of: the
market price of the shares or the deal price. That could be a good exit
opportunity.

With the entrance of a new owner, the company will
get a chance for a turnaround, provided that Yefimov plans to convert
Slovianska Power Plant’s unit from anthracite to hard coal and to construct a
new power unit there. However, such a project will require large external
financing, most likely involving an additional equity contribution. So far,
it’s hard to assess whether such projects are attainable for Yefimov.