You're reading: Dmytro Firtash’s and Ihor Turkin’s companies to bid for Zaporizhia titanium and magnesium plant

Cyprus-based Tolexis Trading Ltd and Luxembourg Company of Metals & Alloys SA (LCMA) will bid in a tender where non-state investors in Zaporizhia titanium and magnesium plant LLC (ZTMK) will be selected, the Ukrainian State Property Fund's press service reported.

Tolexis Trading owns two companies that belong to businessman Dmytro Firtash’s Group DF – Mezhyrichensky ore-mining and dressing mill and Valky-Ilmenite (both based in Irshansk, Ukraine).

LCMA, according to its Web site, was founded in 1996 by Ihor Turkin, and is a majority owner of Stupino Titanium Company LLC, a Russian-based producer of titanium ingots and alloys.

As reported, the bids are to be opened on December 13, 2012.

The winner is required to invest at least $100 million in the company (including a Hr 688.85 million contribution to the charter capital, and the remaining sum, an additional fee, which does not affect the distribution of shares) and provide the plant with raw materials for domestic production (ilmenite).

In addition, the winner has to within three months repay ZTMK’s wage arrears, debts on taxes, and late payments for energy.

Under cabinet resolution No. 955 dated October 3, 2012, ZTMK LLC is to be created through the incorporation of state-run Zaporizhia titanium and magnesium plant’s property into the new company’s statutory fund. The share of the state in the newly created LLC should be at least 51%.

The Kyiv-based Markus Bureau private enterprise assessed the plant’s property at Hr 716.9 million.

The Zaporizhia plant is the only titanium sponge producer in Ukraine and Europe, with an output capacity of 20,000 tonnes per year. However it is only capable of producing 10,000 tonnes at present due to equipment wear.

Dmytro Firtash’s Group DF is considered to be a key investor in the creation of the new company on the basis of state-owned Zaporizhia titanium and magnesium plant. Firtash has repeatedly announced plans to merge his assets in the titanium industry with the state ones and create a single structure in that sector, having gained control of it. In his words, in case he becomes ZTMK LLC’s investor, the plant’s capacity will grow to 40,000 tonnes per year.