Ukraine to auction state-owned stake in Zaporozhye Aluminium Plant on August 6

Ukraine's State Property Fund has announced an auction scheduled for August 6 to sell its 97.5458 per cent stake in JSC Zaporozhye Aluminium Plant. The auction will be conducted on the Prozorro.Sales electronic trading platform, with a starting price set at nearly UAH 151.9 million ($3.7 million). Bidders must submit their applications by August 5.

The auction includes 607,446,012 shares and extensive property assets. The plant's balance sheet lists 1,497 real estate and infrastructure items covering 370,900 square meters, 291 vehicles and special equipment, and 25 land plots totalling 216 hectares. Some of the enterprise's real estate, measuring 6,756 square meters, is currently leased under eight agreements, some valid until September 1, 2065.

The plant has accumulated significant debt, with overdue accounts payable amounting to UAH 6.44 billion. As part of the auction terms, the new owner is required to settle wage arrears and debts to the state budget within 18 months of taking ownership.

In February, the State Property Fund increased its stake in the Zaporozhye Aluminium Plant from 68 per cent to 97.5 per cent. This followed a complex ownership history, beginning with the sale of a 68 per cent stake to Avtovaz-Invest in 2001. By 2006, Velbay Holdings Limited, controlled by Rusal and its primary beneficiary, Oleg Deripaska, had acquired the plant. Deripaska's companies eventually controlled 97.5 per cent of the shares. However, a 68 per cent stake was returned to state ownership in 2015 following litigation, and the remaining 29.5 per cent was ousted in February 2023 by the High Anti-Corruption Court.

Zaporozhye Aluminium Plant was once Ukraine's sole producer of primary aluminium, with a capacity to smelt over 100,000 tonnes annually. The complex mainly produced alumina and primary aluminium, and the Dneproges hydroelectric power station generated electricity for the complex. The plant's operations have been gradually reduced, with the alumina division shutting down in March 2009, the electrolysis shop in April 2011, and the foundry in July 2014. The company's main revenue streams are property leases and the sale of assets and inventories, but it continues to operate at a loss.