NEQSOL Holding, the owner of Ukraine’s second largest mobile operator VF Ukraine (Vodafone Ukraine), has paid UAH 3.94 billion to the state budget of Ukraine in full for the purchase of United Mining and Chemical Company (UMCC, Kyiv) at a privatization tender.
“The winner of the auction paid in full for the state-owned stake in the country’s largest producer of titanium raw materials. The new owner has also undertaken important investment commitments: to invest at least UAH 400 million in the modernization of production, which will ensure the further development of the enterprise,” the SPF said in a statement on Monday.
For his part, NEQSOL Holding’s Regional Director Volodymyr Lavrenchuk noted that the international group of companies, which does business in 11 countries, is taking the steps required by law to complete the privatization process.
“As a strategic investor, we have already started negotiations with a number of specialized companies from the US, Australia, the UK and Canada to attract the best international experience to develop a new strategy for UMCC. This strategy provides for the fulfillment of privatization obligations, deep modernization and expansion in global markets,” he stressed.
The State Property Fund noted that the process of large-scale privatization continues, and on December 19, 2024, 100% of the state-owned share of the nationalized building materials producer Aerok LLC will be put up for sale at an online auction in the Prozorro.Sale electronic trading system with a starting price of UAH 965.3 million.
The SPF reminded that, including the sale of the Ukraina Hotel earlier this fall, the total amount of proceeds from large-scale privatization this year has already exceeded UAH 6.4 billion.
As reported, Cemin Ukraine LLC, controlled by NEQSOL Holding, was the only bidder for the purchase of the UMCC at the auction scheduled for October 9: it offered UAH 3 billion 938 million 351,581 thousand at the initial price of UAH 3 billion 899,358 million.
NEQSOL Holding is founded and owned by Azerbaijani citizen Nasib Hasanov. According to the holding’s website, in the 1990s, during the collapse of the Soviet Union, he started providing brokerage services, initially engaged in the supply of chemicals, developed business in Kazakhstan, Uzbekistan, Azerbaijan, Turkmenistan and other countries of the former USSR, and then in the supply of equipment for the oil and gas industry in the region.
After that, Hasanov used the accumulated capital to invest in the oil and gas industry of Azerbaijan, establishing his own company in this field. The holding’s enterprises in the energy sector are consolidated into two groups: Nobel Oil E&P (UK) Limited (trading name Nobel Upstream), which is engaged in exploration and production in the UK, the US and Azerbaijan, and Nobel Energy, which provides diversified integrated services to international oil and gas operators in the Caspian region and beyond.
The holding entered the telecommunications industry in 2005 by acquiring Bakcell, the first Azerbaijani telecommunications company, and in 2019 NEQSOL Holding bought Vodafone Ukraine. The holding also invests in various startups.
In the late 2000s, the group expanded its business portfolio by making a name for itself in the construction services and materials market, producing cement and related materials. Norm, founded in 2013, is the largest cement producer in the South Caucasus. Before the war, NEQSOL Holding was close to buying Ivano-Frankivskcement, Ukraine’s largest cement producer, but later abandoned the deal.
Currently, the group employs over 12,000 people in 11 countries, including the UK, USA, Turkey, Azerbaijan, Ukraine, the Netherlands, Georgia, Kazakhstan, and the UAE. The company’s headquarters are located in Amsterdam, Baku and Kyiv.
UMCC started its actual operations in August 2014, when the Ukrainian government decided to transfer the property complexes of Vilnohirsk Mining and Metallurgical Plant (VGMK, Dnipropetrovska oblast) and Irshansk Mining and Processing Plant (IGOK, Zhytomyrska oblast) to its management. Previously, these plants were leased from Dmitry Firtash’s structures.
In August 2016, the government included UMCC in the list of companies to be privatized in 2017. The privatization was postponed several times, most recently due to Covid and quarantine.
Before the war, in the second half of 2021, the SPF put UMCC up for auction three times with a starting price of UAH 3.7 billion. The last auction, scheduled for December 20, did not take place as only two bids were submitted, one of which was rejected due to non-compliance with the law. At that time, one bidder was not enough for the sale. This was preceded by a statement by the privatization adviser BDO Corporate Finance that international companies were not ready to participate in the auction due to the lack of guarantees of protection of large investments by the Cabinet of Ministers. At that time, the SPF and the advisor appealed to the government to provide such guarantees, but to no avail.
In 2023, UMCC’s revenue decreased by 15.4% to UAH 1 billion 946.68 million, and its net loss amounted to UAH 481.35 million against a net profit of UAH 13.37 million a year earlier. According to YouControl, in January-September this year, the company increased its revenue by 88.8% to UAH 2 billion 295.5 million, receiving UAH 89.1 million in net profit against UAH 274.2 million in net loss for the same period last year.
