Smart-Holding, which manages various steel and iron ore producing assets in Ukraine, and the Ukrainian steel producer Metinvest Holding (Metinvest) have announced that during their talks regarding Metinvest's participation in the modernization of Smart-Holding's Makeevsk Metallurgical Plant (Makeevsk) they reached an agreement to merge their steel and iron ore assets.
According to the agreement between the companies, Smart-Holding will transfer its stakes in Makeevsk, Inguletskiy GOK and Bulgaria-based steel producer Promet Steel to Metinvest. In exchange, Smart-Holding will become co-owner of Metinvest.
The merger is planned to be completed by the end of the current year.
"The integration of new enterprises in Metinvest is in line with the strategy for development of our iron ore and steel business and presents us with new opportunities for the holding's expansion. As a result, pig iron and steel output will be increased and that will allow us to use our raw material base more efficiently", CEO of Smart Capital Management (parent company of Metinvest) Mr. Oleg Popov stated.
"We have created a world player, which will become one of the leading iron ore and steel producing companies. This will allow us to improve our own as well as the Ukrainian steel industry's competitive ability in the global market", added Smart-Holding's Director for Strategy and Corporate Development Mr. Alexey Pertin.
Upon the completion of the process, the companies plan to coordinate their production strategy in order to raise steel production capacities.