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about $140mn equivalent to VR), as well as in first-tier courts (two rulings for $22mn, no need to pay before the appellate courts confirm such obligations). According to the May 13 ruling, Ukrainian Railways is questioning the validity of the sale of its debt from Prominvestbank to VR Global Partners. The company insists that the deal was a “factoring agreement”, which VR Global Partners does not have the right to do, according to Ukrainian legislation. Based on this, Ukrainian Railways demands that the debt purchase agreement be cancelled. The court decided to freeze the enforcement of payments to VR Global as a preemptive measure while the case is heard.
State monopoly Ukrainian Railways reported on May 27 that it had reached an agreement with Sberbank-Ukraine on the rescheduling of the debt that was due in late May.
The new loan terms imply the postponement of most of the May debt payments till the end of 2021 and a gradual reduction of the interest rate. The deal will lead “to a significant balancing of cash flows and liquidity” of the company, it commented.
The company relates the success of the new deal to the constructive position of the lender as well as assistance from the central bank and Finance Ministry. The company also revealed its intention and reserved its right to refinance the loan in case it attracts funding on the international debt market or from Ukrainian banks.
Recall, July 2020, Ukrainian Railways got restructured Sberbank loans for about USD 200 mln (bearing 12% interest in dollars) that were due on July 31. Maturities under the loans were rescheduled for up to three years, but most of the debt was due in 2021 (about USD 153 mln). This includes a USD 116 mln payment in end-May, as S&P Global Ratings reported in April. S&P downgraded Ukrainian Railways’ rating by two notches (to CCC) on the increased risk of default on this loan. It also promised to further downgrade the company’s rating if it views the new deal with Sberbank as “a distressed exchange” (i.e., if it gives the creditor less value than originally promised).
9.2.4 Construction & Real estate corporate news
Budhouse Group, one of Ukraine’s largest developers, plans to invest €314mn in three projects over the next three years, Anatoliy Shkribliak, company founder and shareholder, tells Interfax-Ukraine. In Odesa, the group is spending €12mn to complete work on Yessa shopping and entertainment centre, aiming for opening in the fall of 2022. In Zaporizhia, Budhouse starts work this summer on Khortitsa Mall, an €82mn shopping centre project on a former industrial site on a major highway. After completing these two projects, Budhouse is to start an €220mn project on Kyiv’s Peremoha Avenue, near Zlatoustivska St. Called Hartz Mall, this will be multifunctional – shopping, entertainment and offices.
9.2.5 Retail corporate news
In its first year of operation in Ukraine, IKEA’s online store has received 2.5mn visitors and 148,000 online orders, said Florian Melle, the head of IKEA in Ukraine (Interfax Ukraine). After the first physical store opened in
69 UKRAINE Country Report XXXX 2018 www.intellinews.com