LONDON: Ferrexpo plc, the London-listed iron ore producer, has agreed to sell its transhipping vessel Iron Destiny for $7.7 million in net cash proceeds and pushed back its projected liquidity deadline to late August 2026, the company announced Monday.
The sale of the vessel, which has been largely unusable since the start of the war in Ukraine, is expected to close later this month following delivery and customary conditions. The company said it had continued incurring monthly maintenance and capital costs to keep the vessel seaworthy despite its underutilization.
“Given the uncertainty relating to the timing of any end to the war and the return of the group’s ability to fully utilize the Iron Destiny as a transhipper, and taking into account the increasing maintenance and capital costs … the board has determined that a sale would be in the best interests of the group,” Ferrexpo said in a statement.
The company also provided an update on its funding position, stating that with the vessel sale proceeds, it now estimates having sufficient net accessible cash until approximately the end of August 2026. That extends a previous forecast that had placed the runway through at least the end of June 2026.
Ferrexpo cautioned that the estimate remains subject to volatile iron ore prices, operating expenses including energy costs, and no material changes to operating conditions or restrictive measures by the insolvency manager appointed within its Ferrexpo Poltava Mining unit.
The company has been exploring funding options, including an equity capital raise, and said following discussions with existing and potential new institutional investors, it believes an equity raise is the most viable solution in the required timeframe. Any such raise would likely be structured as a conditional placing of new shares to raise a minimum of $100 million to support working capital and operational requirements over the next 18 months.
Completion would require shareholder approval at a general meeting. Ferrexpo said it does not intend to publish a prospectus in connection with any possible fundraise.
The company’s largest shareholder, Fevamotinico S.a.r.l., which holds 49.32% of outstanding ordinary shares, is in discussions with the company regarding support for the necessary resolutions. Ferrexpo noted that talks are ongoing given the potential dilutive impact and the shareholder’s desire to participate.
“There can be no certainty that the group will be successful in progressing towards any possible fundraise, or any alternative funding solution, within a suitable timeframe, or at all,” the company said.