Dmytro Sennychenko: privatization of JSC «United Mining and Chemical Company» on August 31 will be a powerful start to the large-scale privatization

During the visit of Prime Minister of Ukraine Denys Shmyhal and Vice-President of the European Commission Maros Sefcovic to the Irshanskyi Mining and Processing Plant of JSC «UMCC», Dmytro Sennychenko, Chairman of the State Property Fund of Ukraine declared unprecedented political support of the President of Ukraine, the Government and the Verkhovna Rada for transparent privatization.

Denys Shmyhal, Prime Minister of Ukraine noted the opportunities for expanding cooperation with Ukraine's strategic partners, which opens up the development of the extractive industry.

«Ukraine has significant potential to become one of the world's leaders in the field of critical raw materials extraction and a reliable supplier of it for NATO partners. Increasing the production of metals of the future will allow developing new processing industries in Ukraine, attracting investments and creating new jobs. I am convinced that launching a strategic partnership with the EU in this direction will help to realize this task», - Denys Shmyhal stressed.

During a visit to the career, Vice-President of the European Commission Maros Sefcovic noted the high impact of reliable and sustainable supply of raw materials at competitive prices for entire sectors of the economy.

«As we move towards climate-neutral and digital societies, many key sectors, such as renewable energy, electronics, transport, aerospace and defense depend on reliable and sustainable supply of raw materials at competitive prices. Thus, today's launch of a strategic partnership between Ukraine and the EU on raw materials is entering a decisive stage. In Ukraine, 20 of the 30 most important types of raw materials necessary for the decarbonization of the economy are stored. In addition, closer integration of our raw material supply chains with the assistance of the geographical environment is a way to minimize the adverse effects of the unintended disruptions demonstrated by the current global pandemic», - Mr. Maros Sefcovic said.

During the meeting, Dmytro Sennychenko, Chairman of the State Property Fund praised the support of reforms in Ukraine by the European Union, in particular the privatization program, which fulfills three main tasks at once: eradication of corruption, attraction of investments in modernization of economic sectors and budget revenues. According to him, the privatization of JSC “United Mining and Chemical Company” will be an excellent example of achieving these goals.

«During preparation for privatization, we managed to make JSC “UMCC” attractive object for investors from all over the world thanks to the disclosure of information on raw materials stocks, the elimination of corruption schemes and the deprivation of oligarchic groups of influence on the enterprise, its profits have tripled from UAH 100 million to UAH 350 million. This led to an increase in the starting price by 60 million euros - up to 140 million euros», - Dmytro Sennychenko said.

By focusing on the fact that titanium is the function of private investors and the function of the state, instead, is regulatory activity, establishing rules and licensing the activities of subsoil users.

«Privatization of JSC "United Mining and Chemical Company» also imposes investment obligations on the future owner – to invest at least UAH 400 million in the modernization of the company's fixed assets. This will contribute to the creation of new jobs and the development of the mining sector», - Dmytro Sennychenko, Chairman of the State Property Fund stressed.

Also, the privatization conditions provide for the protection of social rights of the company's employees” the new owner should not allow the occurrence of wage arrears and cannot dismiss employees within 6 months after privatization.

For reference:

JSC «United Mining and Chemical Company» is the largest enterprise in Europe and is in the TOP-10 in the world for the production of titanium and zircon ores.

The company is established in 2014 by combining the capacities of the Vilnohirsk Mining and Metallurgical Plant in Dnipropetrovsk region and the Irshanskyi Mining and Processing Plant in Zhytomyr region.

Two branches of JSC «UMCC» are engaged in enrichment production of concentrates of titanium ores. Products: rutile, ilmenite, zirconium, stavrolite, dysten-silimanite concentrates.

Date of the privatization auction: August 31, 2021. Starting price: UAH 3.7 billion. Auction step: UAH 50 million.