Metinvest could merge Zaporizhstal, Zaporizhkoks in future

2013-08-08

Aug. 6, 2013 - Metinvest, an international vertically integrated mining and metal group of companies, could merge OJSC Zaporizhstal steel mill and public JSC Zaporizhkoks, one of the largest producers of coke-chemical goods in Ukraine, in the long-term, Director General of Zaporizhstal Rostyslav Shurma has said on a local television channel.
He said that the merger of the two companies is logical, as they operate at one production site and are highly connected from the technological point of view.
"Zaporizhkoks is located on the same production site as Zaporizhstal, and the two enterprises are interconnected from a technological point of view. If we look at the structure of Zaporizhkoks, 100% of its coke is shipped to Zaporizhstal, and around 90% of the coke consumed by Zaporizhstal is coke from Zaporizhkoks. It's a logical and obvious issue to merge Zaporizhstal and Zaporizhkoks," he said.
Shurma said that at present, the issue has not been discussed in detail, and no decisions could be made earlier than in six months.
"I can say with confidence that the enterprises will not merge in the coming year, but in the long-term outlook, it's likely that this will happen. However, this depends on many factors," he said.
He said he does not see the necessity to merge the steel mill with another enterprise of Metinvest – public JSC Zaporizhvohnetryv, the largest manufacturer of refractory products in Ukraine.
"The refractory business is a separate business, so it's wrong to unite it with the steel mill, and we won't do this," he said, adding that Zaporizhstal and Zaporizhvohnetryv have good, close cooperation: 30-35% of Zaporizhvohnetryv's products are consumed by Zaporizhstal.
Zaporizhstal one of Ukraine's biggest industrial plants, is being integrated with Metinvest, which is owned by System Capital Management (71.25%) and Smart Holding (23.75%).
Zaporizhvohnetryv is Ukraine's largest manufacturer of refractory products and high quality materials. Its products are widely used in Ukraine, as well as in the CIS, Europe, Asia and Africa.
Zaporizhkoks produces around 10% of coke made in Ukraine, having a full technological by-coke product processing cycle. The company produces coke gas and pitch coke.