Securities.com, DealWatch - http://www.securities.com
Ukraine's leading fertilizer blend producer UkrTechnoPhos to raise EUR 50mn
Jul 2, 2008 (DW) - UkrTechnoPhos Ltd. (UTP), Ukraine's leading producer and supplier of nitrogen-phosphorus-potassium (NPP) fertilizer blends, is going to attract EUR 50mn via either a private placement, an IPO or inviting a strategic investor.
"While we have formally planned to raise the necessary funds by 1 Jul, 2009, I believe that in case of an IPO the year 2010 is a more realistic term," UTP deputy financial director Mykola Martynenko told DealWatch at the sidelines of the Ukrainian Meeting of Investors 2008.
According to him, the company is yet to make up its mind with regard to the potential floor (so far, the company seems to prefer the Warsaw Stock Exchange) and a financial adviser.
"It is too early to speak about that, as long as we have not tried other options [of raising funds]," Martynenko said. "We would, for instance, be ready to offer a 75-85% stake in a would-be joint enterprise to a Western investor operating in the chemical industry."
According to him, UTP plans to invest the bulk of the expected sum, EUR 40mn, in the designing and building (within two years) of a chemical plant with an annual capacity of 300,000 tons of ammophos, diammophos or NPP.
The remaining EUR 10mn are planned to be assigned in equal parts to the construction (within seven-eight months) of three-four logistics (storage) terminals in the country's various regions and to the acquisition of machinery and equipment which would help speed up the delivery of UTP's products to final users.
"The present fertilizer application rate in Ukraine is approximately four times lower than that registered in the USSR before 1990 and six-seven times lower than the one typical for Western Europe or the USA," "but amidst the global food, fuel and energy crises, the consumption of fertilizers is going to rocket," Martynenko said, commenting the necessity of building the plant.
According to him, presently there are over twenty large agriculture holding companies in Ukraine, which altogether rent approximately 100,000ha of arable land. The long-awaited lifting of the land sale moratorium is likely to urge an agricultural boom in the country.
UTP has been operating in the domestic market since 2000 and exporting its products since 2004. It has three production plants, eight branch offices and 11 storehouses all over Ukraine.
96.34% in UTP belong to Svetlana Suprunyuk, wife of Yury Suprunyuk, UTP director general.
Last year, UTP posted UAH 254.85mn (around USD 50.47mn) in net sales (compared to UAH 119.48mn in 2006) and UAH 12.85mn in net profit (UAH 0.52mn in 2006). Its EBITDA was UAH 22.83mn in 2007 and UAH 4.41mn in 2006.
Oleksandr Gavrylyuk
