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bne October 2021 Companies & Markets I 5
that could impact the economy in the second half of this year.”
Ryzhenkov doesn't think the risk is too great and expects Metinvest to turn in the same sort of results it produced in the second quarter – very good.
M&A
In addition to the modernising and efficiency programme the company has been remaking its profile to become more self- sufficient in inputs through a couple of large M&A deals.
In August Metinvest bought the Dniprovskyy Steel mill in
a privatisation of the bankrupt company that has added 2.4- 2.5mn tonnes per year (tpy) of steel production capacity to the company’s output, paying UAH9.17bn ($339mn) for the assets via its subsidiary Dniprovskyy Coke, the only company that decided to participate in the July 26 auction.
Metinvest also bought Ukraine’s biggest Pokrovske coking coal producer in March, which mines and processes coal to
make coking coal and completely satisfy Metinvest’s needs
for the essential input into the steel-making business. As bne IntelliNews reported this month, the company is in the process of squeezing out the minority shareholders to take complete control of the business. Metinvest intends to invest into these assets too and production at Pokrovske was already up 20% in the first half of this year.
Dividends and debt
After several years of coping with the aftermath of various crises the company has also been taking advantage of the opportunity to clean up the company’s loan portfolio. That means that Metinvest will be able to return more in the way of dividends to shareholders as a result, says Ryzhenko.
The company is paying generous dividends to its shareholders, the biggest of which is Ukraine’s richest
man, Rinat Akhmetov. After the Dniprovsky Metallurgical Plan deal Akhmetov’s holding company System Capital Management (SCM) owns 70% of Ukraine’s steel production,
“A good market lifts all boats and there is a very nice rally on the metals market at the moment that started
at the end of last year, but we have also added $368mn in financial gains as the result purely internal improvements” Yuriy Ryzhenkov, CEO at Metinvest
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