The State Property Fund of Ukraine has again announced an auction for a 97.5% stake in Zaporizhzhya Aluminium Plant (ZalK), halving the starting price to UAH 75.93 million. These are the terms of the auction, published on 5 August on Prozorro.Sale, according to Komersant ukrainskyi
The first auction, at which the price was set at UAH 151.86 million, was not held due to the lack of bids. Formerly owned by Russian oligarch Oleg Deripaska, Zaliznyk is currently in critical condition, with accounts payable of UAH 6.44 billion and a net loss of UAH 57.2 million in 2023.
The plant has huge premises and infrastructure, but its production facilities have not been used for their intended purpose for a long time. The company’s balance sheet includes 1,497 units of real estate and 291 units of vehicles and special equipment. The potential buyer is obliged to pay off wage arrears and budget payments, as well as prevent the dismissal of employees within six months after the acquisition.
Applications for participation in the auction will be accepted until 13 August, and the auction will take place on 14 August.
ZALK
Zaporizhzhya Aluminium Smelter (ZalK) was founded in 1933. Before the Second World War, the plant was the largest aluminium producer in Europe. In the 1990s, after the collapse of the Soviet Union, the company, which was once an important player in the aluminium market, began to decline due to underinvestment and management problems.
In 2001, ZALK was privatised, when a controlling stake was sold to AvtoVAZ-Invest, a Russian company linked to oligarch Oleg Deripaska. This was part of the political and economic confrontation between Ukraine and Russia. Deripaska promised to invest heavily in the modernisation of the plant, but his promises were never fulfilled. After that, the company gradually declined, and primary aluminium production was halted.
Subsequently, in 2015, a Ukrainian court ruled that the privatisation of Zalka was illegal, and the company was returned to state ownership. This decision was an important part of the struggle to regain control over strategic enterprises that had fallen under the influence of Russian businessmen. Despite this, the plant’s operations have not been restored. Currently, the State Property Fund of Ukraine is trying to sell the remains of the once powerful plant, but interest from potential buyers remains low.