The Kyivmiskbud holding company has prepared and sent to the Kyiv City State Administration a detailed calculation of the amount of funds needed to resume construction of residential complexes, which amounts to UAH 4.84 billion, the company’s press service told Interfax-Ukraine.
According to Vasyl Oliynyk, Chairman of the Board and President of Kyivmiskbud, the financial forecasts are based on economic indicators provided by one of the Big Four audit companies and are based on the hryvnia/US dollar exchange rate. Kyivmiskbud specialists have been working on identifying and justifying the necessary funds for the past four months.
“The baseline scenario of financial forecasting provided by Ernst & Young envisages the need for funds in the amount of $107,569,366, which, according to the exchange rate of UAH to the US dollar, which is included in the draft state budget of Ukraine for 2025 ($1 = 45 UAH), amounts to UAH 4,840,621,470). If we subtract the funds required for the completion of Ukrbud’s facilities, which are to be provided by the Cabinet of Ministers, from the baseline scenario of E&Y’s financial forecast (UAH 4.84 billion), the required amount of additional capitalization from the Kyiv City Council will be UAH 2.56 billion,” the head of Kyivmiskbud explains.
Earlier, the Kyiv City Council’s Standing Committee on Budget, Socio-Economic Development and Investment Activity instructed Kyivmiskbud to calculate the amount of funds the company needs to stabilize its operations.
As reported, in March 2024, the KCSA set up a temporary commission to resolve problematic issues related to the activities of PrJSC HC Kyivmiskbud.
An audit of Kyivmiskbud conducted in 2023 by state-owned Baker Tilly Ukraine Consulting, NHD-AUDIT LLC and Ernst & Young LLC found no signs of actions to drive the company into bankruptcy, concealment of financial insolvency or massive transactions by related parties. At the same time, the auditors found that Kyivmiskbud’s operations were disrupted by external factors: COVID-19, a full-scale war, and the Ukrbud factor.
On November 17, 2023, the Kyiv City Council Commission approved an interim report with recommendations and proposals for the developer’s further work, including the purchase of apartments in Kyivmiskbud’s facilities, consideration of a financial loan or additional capitalization of the company. The commission also recommended that the Kyiv City Council address the Cabinet of Ministers on the issue of compensating Kyivmiskbud for the total planned loss associated with the completion of Ukrbud’s projects in the amount of UAH 2.28 billion.
HC Kyivmiskbud was established on the basis of the property of the state municipal construction corporation Kyivmiskbud in 1994 by merging controlling stakes in 28 enterprises and other assets in its authorized capital. The holding company consists of 40 joint-stock companies in which the company owns shares, six subsidiaries and 51 companies as associate members.
According to the National Securities and Stock Market Commission (NSSMC), the main shareholder of PrJSC HC Kyivmiskbud is the Kyiv City Council (80%).
Source: https://interfax.com.ua/
The holding company Kyivmiskbud has analyzed the projects and decided that, subject to the approval of the Kyiv City Council of the mechanisms and sources of financing, starting from the third quarter of 2024, it is possible to start their gradual unfreezing, said Vasyl Oliynyk, Chairman of the Board and President of Kyivmiskbud, at a meeting of the temporary commission for resolving problematic issues related to the activities of PrJSC Kyivmiskbud.
“During this month and a half (after his appointment – IF-U), we managed to inspect all construction addresses – we have 25 of them, 120 buildings in total – analyze the state of affairs in the company and, together with the team, determine the directions we plan to move in order to stabilize Kyivmiskbud. We have physically measured all the scope of work, which allows us to plan. We are facing challenges, among which the search for funding sources is a priority,” he said.
According to Mr. Oliynyk, the actual stabilization plan for Kyivmiskbud will depend on the amount of funds raised.
He clarified that several options are being considered. In particular, cooperation with the utility company Zhytlo-Invest, which can purchase a certain number of apartments under the Rent to Own program. According to the analysis, the existing volume of apartments in the completed facilities allows to raise about UAH 500 million.
In addition, it is proposed to transfer several completed and commissioned kindergartens to the city. According to Oliynyk, since they were built earlier, these buildings need to be adapted to meet increased safety requirements. If the city agrees to buy out these kindergartens after the refurbishment of the shelters, it will give Kyivmiskbud another UAH 200-300 million to complete the facilities.
At the same time, this amount (UAH 700-800 million) will only be enough to restart several sites. To fully unfreeze the facilities, about UAH 2 billion a year is needed, and in total, as previously announced, about UAH 4 billion in 2024-2025.
“We are negotiating with state-owned banks Ukrgasbank and Sens on lending under state guarantees and collateral. The key may be to increase the authorized capital of Kyivmiskbud, and if Kyiv City Council members support this issue, it would be a real help,” Oliynyk outlined the real mechanisms for resuming the company’s work.
He added that currently, each month of downtime costs the company about UAH 10 million (stabilization of facilities, taxes, etc.).
According to Oliynyk, if the necessary funding is accumulated, the launch of all facilities, starting with five, is possible in the summer of 2024.
As reported, in March 2024, the Kyiv City State Administration set up a temporary commission to resolve problematic issues related to the activities of PrJSC HC Kyivmiskbud.
An audit of the company conducted in 2023 by state-owned Baker Tilly Ukraine Consulting, NHD-AUDIT LLC and Ernst & Young LLC found no signs of actions to bring it to bankruptcy, concealment of financial insolvency or massive transactions by related parties. At the same time, the auditors found that Kyivmiskbud’s operations were disrupted by external factors: COVID-19, a full-scale war, and the Ukrbud factor. On November 17, 2023, the Kyiv City Council Commission approved an interim report with recommendations and proposals for the developer’s further work, including the purchase of apartments in Kyivmiskbud’s facilities, consideration of a financial loan or additional capitalization of the company. The commission also recommended that the Kyiv City Council address the Cabinet of Ministers on the issue of compensating Kyivmiskbud for the total planned loss associated with the completion of Ukrbud’s projects in the amount of UAH 2.28 billion.
HC Kyivmiskbud was established on the basis of the property of the state municipal construction corporation Kyivmiskbud in 1994 by merging controlling stakes in 28 enterprises and other assets in its authorized capital. The holding company consists of 40 joint-stock companies in which the company owns shares, six subsidiaries and 51 companies as associate members.
According to the National Securities and Stock Market Commission (NSSMC), the main shareholder of PrJSC HC Kyivmiskbud is the Kyiv City Council (80%).
Detailed schedules of construction of objects of PJSC “HC “Kyivmiskbud” will be ready in 1.5-2 months, the search for sources of financing is the priority of the company, said the newly appointed Chairman of the Board – President of HC “Kyivmiskbud” Vasyl Oleinik.
“We do everything to work closely with the city, process together the directions we generate with the team, and support is promised to us. The main thing we are working on is attracting financial resources,” the press service quotes Oleinik’s words after the meeting with investors.
According to him, the company is also negotiating with banks on crediting, as well as dialoguing with institutions established to provide citizens with housing.
As reported, the mayor of the capital Vitali Klitschko at the end of December 2023 instructed to form a new composition of the nabsovet and board of PJSC Kyivmiskbud in a short time. Earlier, the head of the company Igor Kushnir announced his resignation from the post of chairman of the board – president of the company after 12 years of work.
According to the results of the audit of Kyivmiskbud conducted by Baker Tilly Ukraine Consulting, NHD-AUDIT Audit Firm LLC and Ernst & Young LLC, it was found that there were no signs of actions to bring the company to bankruptcy, concealment of financial insolvency or mass transactions by related parties. At the same time, the auditors found that the activities of Kyivmiskbud were disrupted due to external factors: COVID-19, a full-scale war, the factor of Ukrbud.
On November 17, 2023, the commission approved an interim report with recommendations and proposals for further work of the developer, among which – the implementation of the purchase of apartments in the objects of “Kyivmiskbud”, consideration of the possibility of a financial loan or additional capitalization of the company. The TCC also recommended the Kyiv City Council to apply to the Cabinet of Ministers to compensate Kyivmiskbud for the total planned damage associated with the completion of projects of the construction corporation Ukrbud in the amount of UAH 2.28 billion.
On January 29, 2024, Vladyslav Andronov, Deputy Head of Kyiv City State Administration, was appointed Head of the Supervisory Board of Kyivmiskbud instead of Mykola Povoroznik. In February 2024 the newly formed supervisory board appointed its vice-president Vasyl Oleynik as the chairman of the board – president of the company.
HC “Kyivmiskbud” was established on the basis of the property of the state municipal construction corporation “Kyivmiskbud” in 1994 by combining in its authorized capital controlling stakes in 28 enterprises and other assets. The HC includes 40 JSCs, in which the company holds shares, six subsidiaries and 51 enterprises on the rights of associate member.
The main shareholder of PJSC HC Kyivmiskbud, according to the National Commission on Securities and Stock Market (NCSSM), is the Kyiv City Council (80%).
Vladyslav Andronov, Deputy Head of the Kyiv City State Administration, has been appointed Chairman of the Supervisory Board of PrJSC HC Kyivmiskbud, replacing Mykola Povoroznyk.
According to the company’s announcement in the information disclosure system of the National Securities and Stock Market Commission (NSSMC), the supervisory board made the decision on January 29.
In turn, the territorial community of Kyiv, which owns 80% of the shares of PrJSC HC Kyivmiskbud represented by the Department of Communal Property, on January 26 announced the recall and termination of the powers of the chairman of the supervisory board, Mykola Povoroznyk, who had held this position since December 2022.
Since June 2022, Andronov has been the deputy head of the KCSA for self-government powers. Previously, he served as State Secretary of the Ministry of Agrarian Policy and Food from 2017 to 2021.
As reported, at the end of December 2023, Kyiv Mayor Vitali Klitschko instructed to form a new composition of the Supervisory Board and the Management Board of Kyivmiskbud PrJSC in a short time. Earlier, the head of the company, Ihor Kushnir, announced that he was stepping down as the company’s chairman of the board and president after 12 years of service.
The audit of Kyivmiskbud conducted by Baker Tilly Ukraine Consulting, NHD-Audit LLC and Ernst & Young LLC found no signs of actions to bring the company to bankruptcy, concealment of financial insolvency or massive transactions by related parties. At the same time, the auditors found that Kyivmiskbud’s operations were disrupted by external factors, including COVID-19, a full-scale war, and the Ukrbud factor.
On November 17, the commission approved an interim report with recommendations and proposals for the further work of Kyivmiskbud, including the purchase of apartments in Kyivmiskbud facilities, consideration of a financial loan or additional capitalization of the company. The TAC also recommended that the Kyiv City Council appeal to the Cabinet of Ministers of Ukraine to compensate Kyivmiskbud for the total planned losses associated with the completion of Ukrbud’s projects in the amount of UAH 2.28 billion.
HC Kyivmiskbud was established on the basis of the property of the state municipal construction corporation Kyivmiskbud in 1994 by merging controlling stakes in 28 enterprises and other assets in its authorized capital. The holding company consists of 40 joint-stock companies in which the company owns shares, six subsidiaries and 51 companies as associate members.
The main shareholder of PrJSC HC Kyivmiskbud, according to the NSSMC, is the Kyiv City Council (80%).
Temporary control commission of Kyiv City Council requested from JSC “Holding company “Kyivmiskbud” data on the financial results of the construction company for the period from 2019 to 2022 for audit.
“Today at the first meeting of the commission together with colleagues set the task for representatives of the joint-stock company to provide financial statements on activities for 2019-2022 and the first quarter of 2023, as well as complete information about the started, ongoing, suspended and completed construction projects from 2019 inclusive,” the press service of the Kyiv City Council quotes the head of the temporary control commission, deputy of the City Council Miroslava Smirnova.
The commission also requested data from Kievgorstroy on the accrued and paid in 2019-2022 in the budget of Kiev dividends and related calculations, orders and protocol decisions.
Smirnova pointed out that the commission to verify the information was created after journalists published in May an investigation about the activities of the construction company. The deputy reminded that the territorial community of Kyiv owns a controlling interest in the Holding Company Kyivmiskbud in the amount of 80%, thus the inspection is necessary to protect the legal interests of the community.
After the audit will be made proposals regarding the activities of Kyivmiskbud.
Earlier, Kyivmiskbud reported a significant amount of debt under the installment payment agreements – more than 320 million UAH, which prevents the resumption of active construction work at the sites.
According to Openadtabot, Kyivmiskbud in 2022 received 35.8 million UAH net loss against 4.3 million UAH net profit in the previous year. At the same time, the company’s revenue increased by 23% to UAH 1.8 billion.
HC Kyivmiskbud was created on the basis of assets of state municipal construction corporation Kyivmiskbud in 1994 by combining the controlling interests in its share capital of 28 companies and other assets. The CC includes 40 JSCs in which the company holds the shares, six subsidiaries and 51 companies with the rights of the associated member.
The main shareholder of PJSC HC Kyivmiskbud, according to the NCCSD, is the Kyiv City Council (80%).
According to the results of 2022, the Kyivmiskbud holding company put into operation more than 101,700 square meters of housing, Kyivmiskbud President Ihor Kushnir has said.
“During 2022, we managed to put into operation three residential complexes – Raiduzhny, Hvardiysky and Phase One of Obereg-2. In general, more than 101,700 square meters. And four parking lots for 617 cars,” he wrote on Facebook on Friday.
As reported, at the end of 2021, PJSC Kyivmiskbud Holding Company reduced its net profit by 18.4% compared to the financial result in 2020, to UAH 5.725 million.
