Business news from Ukraine

All SCM enterprises are working for victory of Ukraine – owner

All SCM enterprises are now working for the victory of Ukraine, including on the economic front, the owner of the company Rinat Akhmetov said in an interview with the Swiss edition Bilan.
“Wherever possible, we work for the needs of the front – we help the Ukrainian army and the terror defense forces. Our metallurgical plants produce anti-tank hedgehogs, modular shelters for dugouts, we have already produced and handed over 150 thousand body armor vests to our soldiers for free. Our power engineers heroically every day return light to the houses left without electricity due to constant shelling. We are all working for Ukraine’s victory, including on the economic front,” Akhmetov said.
According to him, the situation in the Ukrainian economy due to the war is extremely difficult, but businesses continue to work, preserving jobs and budget revenues.
“The situation in business now is very difficult – as in the entire Ukrainian economy. All of our enterprises have gone to work in military mode since the first day of the war. Because today our main goal is to help Ukrainians to survive and endure”, – stressed the owner of SCM.
Only for 9 months of 2022 SCM sent to the budget more than 60 billion UAH in taxes and fees.
“For us, SCM, the war began in 2014. Both in Crimea and in the temporarily occupied part of Donbass, we lost all assets. We lost businesses, but it hardened us and made us stronger. We have a very strong team where managers think not only about business, but also about people. I am convinced that we will win this war and come out of it stronger,” summed up Rinat Akhmetov.
As reported, Akhmetov’s businesses from the first days of the war were transferred to the military mode of operation, providing the Armed Forces and defense forces with armor, bulletproof vests and engineering structures made of steel.
Also Akhmetov’s businesses under his Steel Front initiative purchase drones, thermal imagers, radios and other equipment for the needs of the military. Since the start of the war, Rinat Akhmetov’s Foundation, his businesses and FC Shakhtar have donated UAH 3.5 billion in support and humanitarian aid to the armed forces.

UMG COMPLETES FOUR MERGER AND ACQUISITION DEALS SINCE APR 2020

UMG Investments, owned by the SCM Group, has completed four merger and acquisition (M&A) deals since April this year, Investment Director Nadiia Kaznacheieva said at the CFO Forum 2020 held in Kyiv this week.
“We believe in this country, in the business where we work, and we continue investing. Since April, we have completed four M&A deals and opened two new businesses built from scratch,” she said.
Kaznacheieva said that the first such enterprise is the Ukrainian Mineral Fertilizers plant in Kryvy Rih, and the second, of a smaller scale, is the utilization of coal mine methane.
According to her, two projects were carried out in the mining segment, in which the company invests as a strategic investor, but these transactions are not public and are not disclosed.
Another investment was the purchase of a minority stake in Feednova, which is implementing a project to build a plant for the production of high-protein feed additives and animal fats in Busk (Lviv region), the investment director said.
“The importance of a domestic investor is sometimes underestimated. If domestic investors do not invest, it is difficult to expect the arrival of international investors,” Kaznacheieva said.
She added that in the context of the coronavirus epidemic, when even physical movement is limited, attracting foreign investors is even more difficult. “Now is the time of our, local investors, there is money in Ukraine,” the investment director said.
Speaking about the business of UMG Investments and its approaches to investment, Kaznacheieva said that the company operates as a private equity fund, and expects high returns from projects – IRR 25% and higher.
“What are the criteria, where we invest – industries that are growing and which, most importantly, will grow. Unlike Horizon Capital we don’t invest in FMCG. We have a different view of projects: more focused on B2B and export or import substitution,” Kaznacheieva said.
According to her, the white clay mining business from the assets of UMG Investments (VESCO) is the second largest such business in the world. “We will work further, and I believe that we will be number one in the world,” the investment director said.
She said that among the portfolio companies there is also the largest operator for the processing of waste and by-products.

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CORUM GROUP TRIPLES EBITDA IN 2017

Corum Group, which unites the machine building assets of System Capital Management (SCM) financial and industrial group, more than tripled EBITDA in 2017 compared to 2016, to UAH 352 million, the company’s press service has said.
As reported, in 2016 EBITDA came out of the negative level and amounted to UAH 105.4 million.
Consolidated revenue of the company increased by 44%, to UAH 1.995 billion, the volume of signed contracts by 110%, to UAH 2.872 billion.
The share of exports in the sales structure was 41% against 28% a year earlier.
The company said that one of the key events that predetermined the economic development of Ukraine in 2017 was the transport blockade of Donbas.
“After the shutdown of a number of mines in Donetsk and Luhansk regions in February 2017, the orders of which amounted to 27% of the business plan, Corum Group focused on fulfilling orders from the key customers from Ukraine, Russia, Kazakhstan, Vietnam, and Estonia. This ensured the overfulfillment of the plan for 2017 and exceeding the results of 2016 on the main indicators,” a press release reads.
According to the company, in 2017 investments in production amounted to UAH 90 million, which is 1.8 times more than in 2016.

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