You're reading: Kurchenko’s VETEK closes UMH deal ahead of schedule

Multimillionaire businessman Serhiy Kurchenko’s East European Petrol and Energy Company (VETEK) on Nov. 5 finalized its acquisition of UMH group nearly six months ahead of schedule, according to a company press release.

Following the closure of the deal, VETEK and Kurchenko
assumed 99.9 percent of UMH group, solidifying control of the country’s second
largest media group and some of its most influential news outlets.

The official figures for the deal were not disclosed. Previously
the acquisition was estimated to be around $340 million. According to a Forbes
Ukraine source, the final sale amount was increased by up to 5 percent, in
order to close earlier.

Under the initial conditions of the deal, the full transfer
of assets was set to occur in spring 2014, following the final payment.

VETEK had reached a deal to purchase UMH group from
its owner and founder Boris Lozhkin on June 21. Lozhkin founded UMH in 1994. It
has since become one of the leading media groups in Eastern Europe, with a
portfolio of more than 50 brands across numerous publishing platforms, including
Forbes Ukraine and Korrespondent, the country’s most-read news magazine.

Lozhkin today thanked his UMH staff for their work in
building the company. “Together we have built the best media company in Ukraine
and became a significant player in the Russian market. UMH group shareholders
and partners are satisfied with the transaction. I hope that the investment
plans of Serhiy Kurchenko and the professional actions of his team will give a
new impetus to the development of UMH group,” he said.

Commenting on the deal, Kurchenko said: “Thank you for
your cooperation and professional work, VETEK Media team, Boris Lozhkin and
current management group.”

The 28-year-old Kurchenko is estimated to
be worth $400 million, which has allowed him to buy not only UMH, but also the
Kharkiv Metalist football team and the Odesa Oil Refinery, among other assets.

Upon news of the finalized sale, Kurchenko again confirmed his intention to invest in
the development of UMH group. He said previously that
he plans to invest $100 million into the company. He has also promised to
preserve editorial independence of its news publications.

However, news that Kurchenko had made a
deal to buy UMH last summer resulted in a number of high-level editors at some
media controlled by the company to quit their posts. The most notable was Forbes
Ukraine editor-in-chief Vladimir Fedorin, who left the magazine in July.

UMH Group will operate under the specially designed VETEK
subsidiary VETEK Media, headed by Yuriy Rovenskiy.

Kyiv Post
editor Christopher J. Miller can be reached at [email protected], or on Twitter at
@ChristopherJM.