Business news from Ukraine

KYIV INTERNATIONAL AIRPORT (ZHULIANY) PLANS TO INVEST UAH 630 MLN IN RECONSTRUCTION AND TERMINAL AREA EXPANSION

Kyiv Sikorsky International Airport (Zhuliany) is planning to reconstruct the main Terminal A with an area of 14,000 square meters and expand it by 9,500 square meters, estimating investment in this project at UAH 630 million.”The expansion of the terminal area by 9,500 square meters will help double its capacity,” the airport’s press service reported on Tuesday.
The airport’s press service told Interfax-Ukraine that the current airport capacity is about 700 people per hour.
Kyiv International Airport (Zhuliany) is located in the business center of the capital, seven kilometers from the city center. It is the second largest airport in Ukraine in terms of the number of flights and passenger traffic. The airport has three terminals with a total area is 21,000 square meters. Terminal B is separate facility for business-class service, it is part of the Fixed Base Operator (FBO) system. The airport’s runway is able to handle B-737 and A-320 aircraft. In the first nine months of 2018, the airport serviced 2.165 million passengers, which is 57.3% more than in January-September 2017.

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LEADING TEXTILE FABRIC SELLER AND PRODUCER IN UKRAINE TO INVEST UAH 100 MLN IN NEW FABRIC PRODUCTION IN 2019

Textile-Kontakt Group, a leading textile fabric seller and producer in Ukraine, in 2019 plans to invest up to UAH 100 million in a new enterprise that will produce fabric in Chernihiv. Its opening is scheduled for December 2018. “To create new production facilities, Textile-Kontakt plans to invest up to UAH 30 million this year, and up to UAH 100 million by the end of 2019,” the company’s press service reported. In September, the group began repairing workshops with a total area of 3,500 square meters and installation of new equipment. The capacity of the plant will be 2-3 million meters of fabric per year.
The launch of the new production site will allow creating up to 80 jobs and with reaching the full production capacity by the end of 2019 the enterprise will employ up to 100 more people.
According to a press service, the main assortment will be fabrics made from 100% cotton: twill, bleached calico and printed cotton, as well as blended raincoat fabric “Greta”. The company also plans to produce a special fabric for the Ministry of Defense of Ukraine.
The press service reminded that until 2014, the group of companies Textile-Kontakt included the company TK-Donbas, which produced up to 60% of cotton fabrics in Ukraine (2 million meters per month). After 2014, control over the enterprise was completely lost. In 2017, the company planned to create a joint venture with the company Temp-3000 and launch production on the basis of Bohuslavsky Textile (Kyiv region). But from January 2018, Textile-Kontakt left the joint venture, and it was decided to create its own enterprise.
Textile-Kontakt was founded in 1995 and today represents a holding company that combines various areas of assets: wholesale and retail trade, the import of fabrics, accessories and home textiles, as well as tailoring of special clothing (including military uniforms). The founder of the group is Ukrainian businessman and public figure Oleksandr Sokolovsky.

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INTERNATIONAL CHEMICAL PRODUCER BASF TO INVEST EUR 2 MLN IN CONCRETE ADDITIVES PLANT NOT FAR FROM KYIV

BASF, an international chemical producer, is to invest EUR 2 million in a new plant that will produce concrete additives in the town of Obukhiv, Kyiv region, which is to open next spring, Managing Director (CEO) at BASF Ukraine Andreas Lier has said. “There will be about EUR 2 million in investment. This is our first investment in Ukraine. If it is successful, we will continue investing in this production. We have already been present in the Ukrainian market with these products for several years. We have been importing this product for a long time, but now we’ve decided we want to produce it here,” Lier told Interfax-Ukraine.
BASF’s National Development Manager Oleksandr Ruban says that the plant’s production capacity will be 10,000 tonnes of produce per year with the possibility of boosting the output in future. The plant is scheduled to be launched in March-April 2019.
Production in Ukraine will halve the price of concrete additives and will also allow the company to significantly increase its market share.
“Now we are bringing all the additives from abroad, and our share in the market is very small – less than 1%. We plan to grow up to 10% of the market in the first year,” Ruban said in a comment to the Kyiv-based Interfax-Ukraine news agency.
Governor of Kyiv region Oleksandr Horhan forecasts that the production of the additives at the plant in Obukhiv will speed up the pace of construction in Kyiv region.
“Kyiv region is the leader in construction. These additives will make frame-monolithic construction possible amid sub-zero temperatures, allowing construction all the year round. Now such additives are available on the market, but they are imported and expensive,” Horhan said.

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EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT TO INVEST IN RENEWABLE ENERGY IN UKRAINE

The European Bank for Reconstruction and Development (EBRD) is about to invest from $2 million to $4 million in the development of infrastructure of auctions stimulating renewable energy, EBRD Deputy Director in Ukraine Marina Petrov said during her interview to the Reform.Energy website. “This is the money that we are already asking for now from the donors in order to launch a high-quality auction,” she said. She explained that market players might not be able to perceive poorly organized auctions. “This is very important to keep up the balance of interests in order to receive the most outstanding result,” Petrov said. The auctions will have to be transparent, understandable and in line with legislation.
According to her, the EBRD during Ukraine’s transition to the auctions stimulating renewable energy is ready to share its experience from similar auctions in those countries which were the first ones to introduce such tools. Such or similar auctions are held in Turkey, Poland, Bulgaria, Jordan, Egypt, and Armenia, she said.
The amount is to be allocated within the EBRD’s USELF-III lending facility approved in July this year in the amount of EUR 250 million to support private renewable energy projects in Ukraine, she said.
Speaking at the Ukrainian Financial Forum organized by the ICU Invest Group in Odesa, the EBRD representative said that market operators had questions as for who would be a balancing player on this market. She said that the EBRD was working jointly with the U.S. Agency for International Development to create the market of balancing facilities and invest the funds in more mobile parts of the system, e.g. batteries, gas turbines. “This is next year’s agenda,” Petrov said.
In general, she described the situation on the renewables market as a “quick sprint” – the investment is to be made while the current feed-in tariffs are in effect.
“We’ve got many investors who are mulling over investment this and next year. We have fewer investors who are preparing projects for 2020-2021. We see there will be a steep decline,” she said.
In this connection, she called on the adoption of a law on renewable energy auctions by the end of the current year.
Ukraine has great potential for the development of other sectors of renewable energy, mainly biofuel and small hydro facilities, she said.

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DOBROBUT MEDICAL NETWORK PLANS TO INVEST $20 MLN IN NEW BUILDING

The Dobrobut medical network plans by 2020 to open a new medical building, investment in which would be around $20 million, Dobrobut Director General Oleh Kalashnikov said at a press conference at Interfax-Ukraine. “We are working on a new large building. Together with Philips, we have already developed a large conceptual project and approved a medical task for it,” he said.
Currently, a complete reconstruction of the building with an area of 9,600 square meters, located in Sevastopolska Square in Kyiv, is being held, repair works are under way.
According to the director general of Dobrobut, the medical service will be represented in three segments. “First of all, there will be a Center for Cardiovascular Diseases. We also plan to develop oncology and neurology in the building,” he said, adding that the new building will have five angiographic operating rooms.
At the same time, he said that the network intends to invest in angiography in the near future, which will allow Dobrobut to provide a full range of cardiosurgical services of all kinds, including endovascular ones.
“Regarding angiography and endovascular operations, I think that we will be able to do them in November and, accordingly, to cover the whole range of services,” he said, adding that the tender for the purchase of an angiograph is currently at the final stage.
Kalashnikov also said that since the opening of the Center for Cardiac Surgery early 2017, it has carried out a little more than 450 surgeries, 263 of which have been performed using a minimally invasive method.
In turn, Head of the center Oleksandr Babliak said that the center is the first among cardiosurgical clinics in the world, which began to implement multi-vessel coronary bypass surgeries using a minimally invasive method.

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PIF OF SAUDI ARABIA WANTS TO INVEST UP TO $150 MLN INTO UKRAINIAN FARMING COMPANY

The Public Investment Fund (PIF), a sovereign wealth fund owned by Saudi Arabia and a global leader in the volume of investment in agriculture, with the acquisition of the Mriya farming company has made the largest investment in the Ukrainian agricultural sector over the entire period of Ukraine’s independence and plans to additionally invest large funds in the company, Head of Office of the National Investment Council of Ukraine Yulia Kovaliv has said.
“With acquiring Mriya’s assets, the PIF plans additional investments in the technology park and assets of the holding over the next two years in the amount of up to $150 million,” she told Interfax-Ukraine.
“We assume that the next step will be investment in transport and port infrastructure,” Kovaliv said.
In this regard, she pointed out the importance of adopting a new concession law, which is waiting for second reading in parliament. It can become a tool to attract this and other strategic investors to the transport sector.
“Potentially, the PIF is ready to consider projects in the energy and real estate sectors,” the head of Office of the National Investment Council also said.
As reported, Mriya Farming Plc (the U.K.) and SALIC UK Ltd. (Saudi Agricultural & Livestock Investment Company, the U.K.) entered into a share purchase agreement for the sale to SALIC of the Mriya group’s Ukrainian farming assets, including infrastructure facilities, machinery, and companies owning land lease agreements.

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