Ukrzaliznytsia (Kyiv) has lost control over Donetsk Railways and doubts whether it can regain control in the future.

"Ukrzaliznytsia is currently reviewing the impact of certain events on the terms of loans. In particular, Ukrzaliznytsia doubts the implementation of future controls over Donetsk Railways," the administration said in connection with the technical default on a number of its debt obligations, the cross-default on eurobonds worth $500 million, and the start of negotiations on restructuring internal and foreign debts worth UAH 32 billion.

"The reason for this move is the extremely difficult situation in the country, Donetsk Railways' being beyond the control of transportation processes performed centrally, the significant drop in commodity turnover," Ukrzaliznytsia acting CEO Maksym Blank said at a briefing in Kyiv.

Donetsk Railways was the largest cargo carrier in Ukraine. Its share of Ukrzaliznytsia's freight transportation reached 37%. The company served more than 4,000 industrial enterprises in Donbas. The structure of the railroad included 161 separate structural units. The company employed about 57,000 workers.