Things are hotting up at the Ukrainian iron-ore pellet maker that is actually based in Switzerland.
Company statement, May 19:
The Board of Ferrexpo announces that a circular convening a general meeting (the “General Meeting”) is being posted to shareholders today.
On 28 April 2009, the Company received a requisition notice from Hanover Nominees Limited, being a shareholder of the Company holding not less than one tenth of the paid up share capital of the Company, pursuant to section 303 of the Companies Act 2006, requesting the board of directors of the Company (the “Board”) to convene a general meeting.
The purpose of the general meeting is to propose separate resolutions (the “Resolutions”) to appoint Mr. Gennadiy Bogolyubov and Mr. Gregory Gurtovoy as directors of the Company.
The circular sets out the Resolutions and the Board’s unanimous recommendation that shareholders should vote against them, as each of the Directors intends to do so in respect of his own shareholding. The General Meeting is to be held at 10.00 am on Friday 12 June 2009 at the offices of Dewey & LeBoeuf, 8th floor, No 1 Minster Court, Mincing Lane, London EC3R 7Y.Hanover Nominees is representing interests controlled by billionaire Ukrainian businessman Igor Kolomoisky, who you may recall fired off a letter to investors last week urging them to vote against Resolution 13.
(Resolution 13 seeks to renew Ferrexpo’s authority to buy back 10 per cent of its shares).
The chances of Bogolyubov annd Gurtovoy — close business associates of Kolomoisky — being elected to the board are next to nothing. This is because Ferrexpo’s billionaire chief executive, Kostyantin Zhevago, and RPG Industries are likely to vote against the proposals and they control 76 per cent of the company. Hanover, in contrast, owns just over 10 per cent of Ferrexpo.
Indeed, the board of Ferrexpo have already attacked the proposal at Tuesday’s annual shareholder meeting.
But that misses the point. Kolomoisky is seemingly determined to bring his battle with Zhevago out into the open and using Ferrexpo, a FTSE 250 company, to do it.
As we have said before, what this all boils down to is a struggle between two oligarchs, perhaps for control of the Ukrainian banking system. Rivaling Kolomoisky’s Privatbank in Ukraine is Zhevago’s own Finance & Credit Bank, and plans are afoot to recapitalise much of the sector with government (or IMF) money.
Related Link:
The clash over Resolution 13 – FT Alphaville