Business news from Ukraine

Ukrposhta’s investments in development will amount to UAH 1.3 bln – Smelyansky

Ukrposhta JSC’s investments in development in 2024 will amount to about UAH 1.3 billion of its own funds, the company’s CEO Igor Smelyansky said at the Forbes Ukraine Business Breakfast on Wednesday.

According to him, the investments will be directed to the organization of container exchange with the transportation of goods by large-sized transport, due to the growth of parcel shipments. Investments in the creation of container exchange capabilities on the basis of one branch amount to UAH 100 thousand, Smelyansky said.

In addition, in 2024, Ukrposhta plans to buy a letter sorting machine. The machine will sort up to 50 thousand letters per hour using the QR code of an electronic stamp. The unit will be purchased with credit funds, the company’s CEO said.

“Ukrposhta plans to open another 300 post offices in Ukraine “to make the coverage as we want it to be.”

The branches will be opened in Kyiv, Odesa, and Dnipro, Smelyansky said.

According to him, Ukrposhta will open 18 new sorting facilities in the next four months, and a sorting center in Lviv will start operating in two weeks.

At the same time, Ukrposhta will not develop the oversized cargo business due to the high costs of further delivery of goods related to taxes.

Ukrposhta’s CEO emphasized that the company has not abandoned the idea of acquiring the bank. According to him, the effect of the transfer of PINbank to the company will amount to UAH 5 billion over three years.

“We will reduce budget expenditures on pension delivery by UAH 5 billion over three years,” Smelyansky said.

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Israel to provide Ukraine with early warning systems for missile strikes

Israel plans to provide the Ukrainian army with early warning systems for missile strikes and drone attacks, Israel’s Permanent Representative to the UN Gilad Erdan said during a meeting of the UN General Assembly on February 26.

“Israel is working to provide Ukraine with early warning systems in order to save civilians from Russian attacks. We are forced to become experts in this field, and we are ready to share our expertise with our Ukrainian friends who need help,” Erdan emphasized in his speech.

He also noted that Israel has been supporting Ukraine since the first weeks of Russia’s full-scale invasion.

“Israel sent over 100 tons of humanitarian equipment to our Ukrainian allies during the first week of Russia’s invasion. We have also deployed field hospitals in Ukraine that have helped thousands of wounded, and hundreds of Ukrainian patients have been treated in hospitals and clinics in Israel,” the Israeli representative said.

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Kernel’s shares rose by 26.7%

On Wednesday, the share price of Kernel, one of Ukraine’s largest agricultural groups, jumped by 26.7% on the Warsaw Stock Exchange, reaching the highest trading volume since mid-December last year.

According to the Warsaw Stock Exchange’s website, the shares rose from PLN10.49 to PLN13.30 at the opening of trading, with some deals being made at PLN13.90 per share.

As of 17:00 in Warsaw, the turnover reached 283.62 thousand shares, and the value of the transactions amounted to 3.50 million ($877 thousand at the current exchange rate).

Minority shareholders, who have united against the delisting plans and the earlier additional share issue, suggest that such activity may be related to the purchase of shares by the majority shareholder and the company’s CEO, Andrey Verevsky, to reach the 95% threshold and demand their mandatory redemption. However, there is no official confirmation of this information.

As reported, Verevsky’s Namsen increased its stake from 41.3% to 74.05%, or 62 million 222.46 thousand shares, as part of the share buyback announced in March 2023 for the further delisting of the agricultural holding from the Warsaw Stock Exchange: On May 12, Namsen bought back 30 million 248,449 thousand shares at a price of PLN18.5 per share (approximately $4.47 at the then exchange rate), which brought the total buyout price to approximately $136.1 million, while the company’s 2007 IPO was held at a price of PLN24.

During the over-allotment initiated by Wierewski in August 2023 among qualified investor shareholders, Namsen acquired another 212 million 634,916 thousand shares for a total over-allotment of 216 million shares. The purchase price was $0.2777 per share, for a total value of approximately $59.1 million, and the transaction was completed on September 1. The over-allotment shares are held in registered form and will not be admitted to trading on any stock exchange, Kernel said.

After the announcement on August 22, 2023, of the start of the pre-displacement and until September 15, the share price fell from PLN13.74 to a historic low of PLN6.34.

Subsequently, in November, Namsen acquired another 1.2 million shares in the company, or 0.4% of the total number, at a price of $1.875 per share, which, including treasury shares, increased Verevsky’s stake to 94.37% of the voting shares.

On March 21, Kernel’s shareholders’ meeting will consider reducing the company’s share capital by canceling 2.2%, or 6.602 million treasury shares owned by its subsidiary Etrecom Investments Limited. It is specified that as a result, the number of shares will be reduced to 293 million 429.23 thousand, and the share capital – to $7 million 748.29 thousand. In case of cancellation of treasury shares, the share of CEO Verevsky through his Namsen Limited will increase from 92.30% to 94.37%.

Minority shareholders have announced plans to challenge the move with the Luxembourg regulator and in the courts. On November 17, private investor Pavlo Boyko said that a group of investors was working with law firm Brucher Thieltgen & Partners. According to him, more than a thousand investors from all over the world have united, “from the smallest to 1 million shares.” The court will preliminarily consider the first lawsuit on March 18.

Before the war, Kernel was the world’s largest producer of sunflower oil (about 7% of global production) and the world’s largest exporter (about 12%). It is one of the largest producers and sellers of bottled oil in Ukraine. In addition, it is engaged in the cultivation and sale of agricultural products.

Kernel’s net profit for FY2023 amounted to $299 million, while the company ended the previous year with a net loss of $41 million. The agricultural holding’s revenue for FY2023 decreased by 35% to $3.455 billion, but EBITDA increased 2.5 times to $544 million.

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Dynamics of the exchange rate of hryvnia to U.S. Dollar in 2022-2023

Dynamics of the exchange rate of hryvnia to U.S. Dollar in 2022-2023

Source: Open4Business.com.ua and experts.news

President of Ukraine met with President of Montenegro

Presidents of Ukraine and Montenegro Volodymyr Zelenskyy and Jakov Milatovic discussed regional security issues and coordinated cooperation between the two countries on international platforms in Tirana as part of the Ukraine-Southeast Europe Summit, the press service of the Ukrainian president reports.

“In the framework of the Ukraine-Southeast Europe Summit in Tirana, President Volodymyr Zelenskyy met with Montenegrin President Jakob Milatovic,” the press service of the Ukrainian president said on Wednesday.

The President of Ukraine expressed gratitude for the Montenegrin side’s support for the Vilnius Declaration of the Group of Seven and the Ukrainian Peace Formula, and informed the Montenegrin president about preparations for the first Global Peace Summit in Switzerland. Zelenskyy spoke about the joint architecture of Ukraine’s efforts to restore a just and lasting peace.

“The leaders coordinated cooperation between the two countries on international platforms,” the press service said.

Zelenskyy also thanked Montenegro for sheltering Ukrainians who were forced to flee their homes due to the full-scale Russian invasion. The parties discussed the treatment and rehabilitation of Ukrainian soldiers in Montenegro.

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Ukraine has received $760 mln in grants from Japan and Norway

Ukraine has received $760 million in grant funds from Japan and Norway, Ukrainian Prime Minister Denys Shmyhal has announced.

“The funds were received through the World Bank’s PEACE in Ukraine mechanism. They will be used to cover the priority expenditures of the state budget,” Shmyhal wrote in a telegram on Wednesday.

According to him, in 2024, Ukraine expects tangible financial support from Japan. “We have held many talks on this issue in Tokyo and obtained significant results. I thank our partners for their unconditional support,” Shmyhal wrote.

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