Ferrexpo, a mining company with primary assets in Ukraine, is facing a severe financial shortfall. As of April 17, the company’s net cash position was only $17 million, and according to the board of directors, it is urgently necessary to raise at least $100 million in additional equity capital to ensure ongoing operations. In the absence of such funding, shareholders risk losing the entire value of their investments.
This is reported by Finway
Plans for Capital Raising and Possible Consequences
According to Ferrexpo, a conditional placement of new shares among existing and potential institutional investors is planned. The aim of this step is to raise no less than $100 million to support working capital and cover short-term operational expenses, allowing the company to operate at a reduced level for the next 18 months.
The fundraising process is expected to begin and conclude no later than April 30, 2026, subject to the approval of the relevant decisions at the general meeting of shareholders and the listing and trading of the new shares. This is necessary for Ferrexpo to publish audited financial results for 2025.
Risks for Shareholders and Future of Share Trading
The company emphasizes that if the capital raising plan is not fulfilled, the listing and trading of Ferrexpo shares will be suspended from 7:30 AM on May 1, 2026, until the completion of the audit and publication of the annual report for 2025. To resume trading, appropriate financial decisions will need to be made to ensure the preparation of reports based on the principle of going concern.
“In such a scenario, there can be no certainty regarding the expected timeline for lifting the suspension of the listing and resuming trading of the company’s shares, if it happens at all,” the information states.
Ferrexpo is also in negotiations with its largest shareholder, Fevamotinico Sarl, owned by Konstantin Zhevago, who holds 49.32% of the company’s shares (294,993,686 shares), regarding the possibility of supporting the capital increase decision at the general meeting.
It is worth noting that Ferrexpo shares lost 11.91% in price at the start of trading on Wednesday, dropping to 38.02 pence. This corresponds to a market capitalization of GBP258.2 million.