REG - Ferrexpo plc - Update regarding Ukrainian subsidiary

FerrexpoAnnouncement

15/05/2025 12:30

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RNS Number : 8622I  Ferrexpo PLC  15 May 2025

15 May 2025

Ferrexpo plc

("Ferrexpo" or the "Group")

 

Update regarding Ukrainian subsidiary

Ferrexpo plc (LSE: FXPO), provides an update on proceedings against the
Group's subsidiary Ferrexpo Poltava Mining ("FPM") in Ukraine.

Application to open bankruptcy proceedings of FPM

Ferrexpo has received information that on 14 May 2025 the Commercial Court of
Poltava region (the "court") has accepted for consideration an application
from 'LLC "Financial Company" "Maxi Capital Group"' ("Maxi Capital") to open
bankruptcy proceedings of FPM. Maxi Capital filed such application on 9 May
2025 in connection with the contested sureties claim (see further background
on the claim below). Whilst the court has accepted the Maxi Capital
application, no formal bankruptcy proceedings of FPM have commenced. The court
has scheduled a preparatory court hearing for 27 May 2025 at which it will
consider the Maxi Capital application.

Based on advice from Ukrainian legal counsel, during the upcoming preparatory
hearing the court should take into account that there is currently a dispute
between Maxi Capital and FPM, no final decision in relation to such dispute
has been made by the Supreme Court and as detailed below the Supreme Court has
suspended the possible enforcement of such claim.

The proceedings at the Supreme Court relating to the contested sureties claim
are currently pending and the Supreme Court decided during the most recent
court hearing, held on 12 May 2025, to consider the case by a panel consisting
of nine judges. The date of the next court hearing has not yet been scheduled.
Ferrexpo continues to vigorously defend its position in the contested sureties
claim before the Supreme Court.

Contested Sureties claim, background

On 7 December 2022, FPM received a UAH4,727 million claim from Maxi Capital in
respect of contested sureties under which Maxi Capital alleges that FPM
guaranteed the performance of obligations by Bank Finance & Credit under
certain loan agreements. Bank Finance & Credit is undergoing a liquidation
process after having been declared insolvent by the National Bank of Ukraine
and put under temporary administration on 18 September 2015.

As Ferrexpo previously announced, on 26 January 2024, a Ukrainian court of
appeal confirmed the UAH4,727 million claim against FPM (approximately US$124
million at that time). On 30 January 2024, FPM filed an appeal to the Supreme
Court of Ukraine, and on 1 April 2024, the Supreme Court of Ukraine suspended
the possible enforcement of the decision of the Ukrainian court of appeal.
Enforcement procedures therefore cannot be initiated by Maxi Capital pending a
final decision by the Supreme Court, or the Supreme Court's suspension order
otherwise being lifted. Although the Group's management is of the opinion that
this claim is without merit, the Group recorded a full provision in the amount
of UAH4,727 million (approximately US$112.5 million as at 31 December 2024) in
its FY23 financial accounts, and this provision was retained in the FY24
financial accounts, considering the magnitude of this specific claim and the
risks associated with the judicial system in Ukraine.

 

This announcement contains inside information. The person responsible for the
release of this announcement is Mark Gregory, Group Company Secretary. Further
announcements will be made as appropriate.

 

For further information please contact:

 Ferrexpo:
 Nick Bias       n.bias@ferrexpo.ch (mailto:n.bias@ferrexpo.ch?subject=Contested%20sureties)
                                                                                              +44 (0)7733 177 831

 Tavistock:
 Jos Simson      ferrexpo@tavistock.co.uk                                                     +44 (0)20 7920 3150
 Gareth Tredway                                                                               +44 (0)7785 974 264

 

About Ferrexpo:

About Ferrexpo: Ferrexpo is a Swiss headquartered iron ore company with assets
in Ukraine and a listing in the equity shares commercial companies category on
the London Stock Exchange (ticker FXPO) and a constituent of the FTSE 250 and
FTSE4Good indices. The Group produces high grade iron ore pellets, which are a
premium product for the global steel industry and enable reduced carbon
emissions and increased productivity for steelmakers when converted into
steel, compared to more commonly traded forms of iron ore. Ferrexpo's
operations have been supplying the global steel industry for over 50 years.
Before Russia's full-scale invasion of Ukraine in February 2022, the Group was
the world's third largest exporter of pellets. The Group has a global customer
base comprising of premium steel mills around the world. For further
information, please visit www.ferrexpo.com (http://www.ferrexpo.com) .

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