Rights of Ferrexpo minority shareholders may be infringed

14:28, 15 May 2009
Ukraine
792 0

Due to plans to buy out shares and carry out additional issue

Rights of minority shareholders of Ferrexpo company may be infringed due to the plans of majority shareholders to buy out shares and carry out an additional issue.

Vyacheslav Butko, director of economic programs at the Center for Corporate Relations Studies, claimed this to a press conference in UNIAN on Friday, May 15.

According to him, a general meeting of Ferrexpo shareholders is due to take place on May 19 of the current year. Its agenda includes issues concerning redemption of stock and carrying out of an additional issue of the company’s shares. According to the information of V.Butko, on the whole, they plan to buy out up to 10% of the company’s shares, and he does not rule out that the shares may be bought from structures affiliated to the strategic owner. Thus, according to him, the purchase will be carried out in the interests of the company’s majority investor, but at the expense of Ferrexpo itself, where the share of minority shareholders makes 49%.

In the opinion of V.Butko, minority shareholders may get into an disadvantageous situation, because shares may be bought at their expense from a company that does not belong to them.

V.Butko also did not rule out an eventual infringement of minority shareholders’ rights should the shareholders meeting make a decision to carry out an additional issue. According to his information, they plan to increase the statutory fund by 27-28%, with the sale being carried out at 10 p. per share, while their market price makes 1.3 pounds, as of today.

UNIAN reference. Ferrexpo (Swizerland) is a producer and exporter of iron-ore pellets. The company owns more than 85% of one of Ukraine’s largest pellets producers, the Poltava Ore-Dressing and Processing Enterprise.

51% of Ferrexpo belongs to Ukrainian businessman Kostyantyn Zhevago.

If you see a spelling error on our site, select it and press Ctrl+Enter