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Sweden’s EcoEnergy chairman Lars Guldstrand (center) and the Ukrainian government signed a 20 billion euro framework agreement on June 15 to construct waste-to-energy facilities in Ukraine. UNIAN Swedish firm to invest into waste-to-energy; Regal raises $105 million to fund Ukraine fields; Ferrexpo does not elect Privat representatives; BNP Paribas increases stake in UkrSibbank; Developer XXI Century seeks debt restructuring.

Swedish firm to invest into waste-to-energy

The Swedish company EcoEnergy Scandinavia and the Ukrainian government signed an agreement on June 15 to construct and operate waste incineration plants in the country.

“With state of the art technology, these plants will lead to large environmental advantages as well as a new cost efficient energy source for Ukraine,” the company said in its media release.

EcoEnergy will construct and operate up to 14 local plants for incineration of all sorts of waste to produce electricity, heating/cooling and biogas. The environmentally friendly technology used by the company enables carbon dioxide neutral production and operation.

EcoEnergy said it intended to bring third party investors and partners to speed up the implementation of its ambition plan that requires an investment of up to 20 billion euros. The project for the first two cities is planned to start up in the second half of this year.

“High-tech waste-to-energy plants will give us access to a renewable energy source that will be developed in a larger scale – something that will contribute to an increased independence regarding energy supply and for the country as a whole,” said Prime Minister Yulia Tymoshenko.

EcoEnergy is a Swedish supplier of waste-to-energy (WTE) facilities. The company’s engineering team has been involved in the construction of most of the large scale WTE facilities in Sweden during the last decade.


Regal raises $105 million to fund Ukraine fields

British-based oil and gas explorer Regal Petroleum said on June 12 it raised $104.7 million through a share sale.

The company said it needed additional funds to fully develop its Ukrainian gas fields and was in talks with parties about funding options and partnerships.

A source familiar with the matter told Reuters news agency that the company planned to meet management at TNK-BP, oil major British Petroleum’s Russian joint venture, next week to discuss possible tie-ups.

“They’ve been talking for 6-9 months ... TNK may decide to get off the fence,” the source said.

The companies have previously discussed a number of options, including TNK-BP taking a stake in Regal, buying a share of Regal’s gas fields and a possible acquisition of Regal, the source and others familiar with the matter said.

Last year, the company planned to partner with Royal Dutch Shell to develop its significant Ukrainian gas reserves.

But that deal unraveled days after being announced, when a new chief executive, David Greer, was appointed and opposed it.

“We continue to review a number of possible funding and partnership options that are in the best interests of our valued shareholders,” Greer said in a statement.


Ferrexpo does not elect Privat representatives

Ukrainian iron ore producer Ferrexpo held an extraordinary general meeting on June 12, at which 88.5 percent of votes decided against electing representatives from Ralcon Commercial and Fayver Properties as members of the board of directors. These two companies, through which Ukrainian billionaire Igor Kolomoisky holds his 10 percent stake in Ferrexpo, stated that they are still committed to being long-term investors in the steelmaker. RiskMetrics, a shareholders advisory group, earlier recommended that shareholders vote against electing both directors representing the interests of Fayver Properties and Ralcon Commercial.

Representatives of Fayver Properties and Ralcon Commercial said Ferrexpo’s chief executive, Kostyantyn Zhevago, is in breach of Ukrainian law which prohibits a Ukrainian member of parliament from holding any senior management position.

Zhevago, who became chief executive last October, is a Ukrainian billionaire and has been a member of parliament since 1998 as part of the Bloc of Yulia Tymoshenko. He holds 51 percent of Ferrexpo’s shares.


BNP Paribas increases stake in UkrSibbank

The equity stake of the UkrSibbank’s main shareholder – the French group BNP Paribas – had increased by 24.5 percent to 75.5 percent, according to a June 12 announcement. This was the result of businessman Ernest Galiev having sold his entire 24.5 percent stake in UkrSibbank to the French group. The financial crisis had a negative impact on a number of Galiev’s projects, and he was unable to fully participate in the necessary increase of the bank’s capital, according to media reports. Therefore, the parties agreed to sell his stake, the result of negotiations that had begun at end 2008. The details and price of the deal were not disclosed.

This news marks a contrast with Galiev’s partner, Olexandr Yaroslavsky, who retained his 24.5 percent stake in the bank and intends in future to provide investment capital in proportion to his shareholding.

Although his stake is less than blocking, Kommersant-Ukraine newspaper quoted Yaroslavsky as stating that he and BNP Paribas have reached a shareholding agreement that allows him to influence strategic decisions during the shareholders meeting.

A Troika Dialog investment bank report said the increase in capital of BNP Paribas’ Ukrainian bank is positive and suggest that the deal demonstrates commitment of the French banking group to develop its business in Ukraine, while a more concentrated shareholder structure will provide flexibility with regard to financial support for the bank. At the end of June, the European Bank of Reconstruction and Development’s board of directors is to consider and most likely approve extending to UkrSibbank a 10-year, $100 million loan.


Developer XXI Century seeks debt restructuring

XXI Century, the London-listed Ukrainian real estate developer, said it has offered its bondholders new conditions for restructuring of payments due on May 24, 2010. The company said it sent letters to its coupon holders suggesting that the term of final payment should be moved to November 24, 2014, while partial payment of bonds will commence on Nov. 24, 2010.

The company also suggested that bond holders should appoint their own representative to the company’s board of directors who could approve major asset-selling deals, creation of joint ventures, new loans and bonuses to company management.

The company also suggested that 50 percent of revenues from the sale of its assets and 50 percent of new loans should be directed to early coupon payments.

The company, one of Ukraine’s leading real estate developers, was founded and is majority owned by businessman Lev Partskhaladze. XXI Century brought all of its projects, including hotels and shopping centers, to a standstill in 2009. The company was building four of them, while another 39 were drafted and at various stages of approval and preparation.