Ukrainian mining and steel giant Metinvest has announced that it is evaluating the potential sale of its US-based subsidiary, United Coal, after receiving a non-binding acquisition offer. The move comes amid a prolonged slump in the coking coal market, elevated production costs, and disruptions caused by the ongoing war in Ukraine.
Operations under pressure
United Coal, which supplies coking coal essential for steel production, has faced significant operational and financial challenges in recent years. In 2024, the company reported a negative EBITDA of $42 million, with further deterioration expected in 2025 due to persistent geological difficulties, high logistical expenses, and weak global coking coal prices.
To sustain steelmaking operations in Ukraine, Metinvest resumed seaborne intragroup deliveries of coking coal from United Coal, compensating for halted production at the Pokrovske Coal facility due to the ongoing war. This logistical shift, while ensuring continuity, also contributed to increased costs.
Strategic offer under review
For Metinvest, these market conditions have eroded profitability, prompting management to explore strategic options. The company stated that it will carefully assess the offer and announce its final decision in due course.