The Ukrainian state has nationalized a titanium sponge plant formerly partially owned by the oligarch Dmytro Firtash.
Dmytro Firtash has been of his minority share of 49 percent in a titanium sponge plant in Zaporizhzhia in the eastern part of Ukraine and the only of its kind in Europe, according to Kyiv Post.
The State Property Fund has maintained a 51 percent share. The plan is now to attract investors, who are willing to put in the necessary capital to restore the profitability of the company, that reported 60 million USD in losses in 2019.
Firtash’s company has denied all accusations and have stated, that they intend to bring the case further up the ladder in the justice system.
Ukraine is sitting on a fifth of all the world’s reserves of titanium. It is used in rocket engineering, electronics, healthcare and the defense industry as well as aviation, yet the company is still not making money. Titanium sponge is the product created in the first stage of titanium processing.
Ukraine is known for metallurgical work and engineering. However, another state-owned company in this sector is also looking for new investors. Last week, the state-owned Bolshevik machine building plant was to be put up for auction in October. The starting price is 52 million USD with a few conditions attached.
The factory, located in Kyiv close to the Shuliavska metro station, spans over 35 hectares and could attract as much as 500 million USD in real estate investments, according to Ukraine Business News. However, buying the plant comes with some strings attached.
First and foremost, the 19 million USD debt of the plant has to be paid back, wages of the 315 employees needs to be backed and a 2 million USD investment in “preservation of basic activities” is also required. The factory is 140 years old and the most modern equipment dates back to the eighties.
Zelensky vs. the oligarchs
Ukrainian president Volodimir Zelensky has set out to defeat the oligarchs‘ control over the Ukrainian economy. Just one week ago the state of Ukraine threatened energy monopolies with state takeovers, if certain conditions were met.
In June, Zelensky submitted a new plan to combat the oligarchs. The bill says that people who are officially recognized as oligarchs by the government will be prohibited from making political donations, taking part in the country’s privatization of state assets, among other things. It is aimed at removing the political influence of oligarchs in Ukraine.
Some argued it was a political stunt to remove one of his most prominent political opponents, former president Petro Poroshenko, and the pro-Russian party of Medvedchuk, who has also been sanctioned by the Ukrainian government.