16:01 02.03.2011

Yaroslavsky sells Cherkasy Azot to Firtash

3 min read

Group DF Board Chairman Dmytro Firtash has bought Cherkasy-based OJSC Azot from businessman Oleksandr Yaroslavsky.

"The joining of the plant to the group of assets that are under control of Firtash will optimize the production and sales policy and help introduce unified standards for the company's management," reads a report of Firtash's press service.

According to the press release, the combined facilities of the nitric fertilizer producers under Firtash's control total 2.44% of the world's facilities, and the share of companies located in Ukraine is 2.28%.

"The integration of the Ukrainian chemical sector is an optimal strategy, which would maintain and multiply the country's production potential. The global players in the fertilizer market that are direct competitors of the Ukrainian chemical sector have also chosen this strategy," the press release says.

The owner of DCH Holding Yaroslavsky confirmed the sale of Azot in Cherkasy to the owner of Group DF, Firtash.

"The businessmen decided on this in early March 2011. The value of the deal is not disclosed, while Yaroslavsky said that he was satisfied with it," reads a report of DCH's press service.

Reports about talks between the businessmen appeared in the second half of 2010. In late January 2011, Yaroslavsky said that he would agree to selling OJSC Azot in Cherkasy if the offer comes to no less than $800 million.

"The plant has operated well since I invested $250 million over five years and lowered gas consumption to the best level in Ukraine. So far there is enough of it and the safety margin is sufficient. We will see [how things go] there," he said at the time.

Yaroslavsky's holding said that the plant's share of the Ukrainian mineral fertilizer market is around one fourth and working at full capacity it could produce around two million tonnes of mineral fertilizers per year, as well as other chemical products.

The company has over 40 production subdivisions on 500 hectares. The number of employees is over 4,000 people.

Azot in 2010 cut production of carbamide by 3.8% compared to 2009, to 637,100 tonnes, while its ammonium nitrate output grew by 8.7%, to 844,400 tonnes and ammonia production soared by 29.1%, to UAH 631,500 tonnes.

As of early October 2010, Azot's total asset came to UAH 3.39 billion, its equity capital stood at UAH 1.57 billion and its short-term liabilities reached UAH 980 million. The company did not have long-term liabilities.