Ukraine ETF Bets on Ferrexpo While Trading Stays Frozen and Cash Dwindles
Published on 05/16/2026 at 16:25 | Redaktion boerse-global.de
A curious market contradiction has emerged around Ferrexpo: an exchange-traded fund focused on Ukraine’s reconstruction has snapped up shares of the iron ore producer even as its stock remains suspended in London and the company stares down a potential insolvency. The HANetf Ukraine Reconstruction ETF added Ferrexpo to its holdings, a move that might strike many as baffling given the miner’s precarious state. Tom Bailey, head of research at HANetf, explained that the fund is a passive vehicle following a strict index – it acts as a mechanical buyer, not a discretionary one.
The trading halt at the London Stock Exchange dates back to May 1, triggered by Ferrexpo’s failure to deliver its audited annual results for 2025. The sticking point is the going-concern assumption. Auditors have demanded proof that the company can stay afloat, and that proof hinges on a capital injection of at least $100 million. Without it, management has warned that cash reserves will run out around the end of August 2026. At the last check, net cash stood at roughly $20 million, of which only about $17 million was freely accessible – the rest was tied up at MBaer Merchant Bank.
Behind the liquidity squeeze lies a tangled dispute with Ukrainian tax authorities. Since March 2025, the government has halted value-added tax refunds to Ferrexpo, citing personal sanctions against majority owner Kostiantyn Zhevago. The company insists those sanctions do not apply to the group or its subsidiaries. The net VAT claim stood at $90.3 million at the end of March, with $78.9 million filed for refund and $69.4 million denied. The blocked cash is a serious blow: production has already slumped to roughly a quarter of pre-war capacity, forcing cuts in staff, maintenance, investment and social programmes.
Should investors sell immediately? Or is it worth buying Ferrexpo?
Compounding the financial strain, a local court in Ukraine has opened insolvency proceedings against Ferrexpo’s key subsidiary, Ferrexpo Poltava Mining. The claim stems from a disputed guarantee worth 4.727 billion Ukrainian hryvnia. Ferrexpo intends to appeal, but the appeal does not automatically halt the process. With the clock ticking on the cash runway, the legal and fiscal pressures are converging.
Ferrexpo’s salvation hangs on a capital increase. Institutional investors have expressed interest in providing more than $100 million, but the company says the conditions cannot be met within the necessary timeframe. The largest shareholder, Fevamotinico, which owns nearly half the stock, has signalled support – provided the total does not exceed $100 million. That caveat could prove critical if the amount needed edges higher.
All of this leaves Ferrexpo’s share price frozen at 28.58 pence, close to its year low. For ordinary investors, the stock is untradeable. Yet for the HANetf Ukraine Reconstruction ETF, the holding is a symbolic bet on a post-war recovery – even if it remains unclear whether the company can survive until then. The path back to active trading requires a successful capital raise, audited accounts, and a resolution to the tax dispute. None of those are assured.
Ad
Ferrexpo Stock: New Analysis - 16 May
Fresh Ferrexpo information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
Disclaimer regarding our articles: No investment advice, no buy or sell recommendation. Information on prices, companies, and markets is provided without guarantee; changes are possible at any time. Stock market transactions can lead to substantial losses. Our articles are created and reviewed in whole or in part automatically with the support of AI.
