Ferrovan Oy to go into liquidation
The General Meeting of Ferrovan Oy, a portfolio company of Finnish Minerals Group, has decided to apply for voluntary liquidation of the company. During the voluntary liquidation procedure, the goal is to identify the conditions for realizing the company’s assets, for finding a purchaser for the business or for the controlled shutdown of the company’s operations. Finnish Minerals Group is not a shareholder of the company but has convertible loan receivables and related option rights in the company.
Ferrovan Oy’s goal has been to build a metal production plant in Raahe for extraction of vanadium from LD-slag, a by-product of steel production. The project would have been a high-technology circular economy project. Vanadium is mainly used in steel and chemical industry. The Ferrovan project began in 2011, and Finnish Minerals Group was involved in the last 6 months of the project. The negotiations for the financing needed to build the plant were at an advanced stage. Unfortunately, the company was not able to reach an agreement on changes to the raw material supply contract that were required by the financiers. Due to this and the increased investment costs, the financiers and owners concluded that it was no longer feasible to continue advancing the project.
Finnish Minerals Group will make a write-down of just under EUR 11 million for Ferrovan. The majority of this sum is based on investments in Ferrovan which were made earlier by Finnish Industry Investment Oy (TESI) and transferred to Finnish Minerals Group in autumn 2018. The actual financial loss of Finnish Minerals Group is EUR 3.1 million.
“Ferrovan was an extremely interesting and innovative circular economy project where slag containing vanadium, a by-product of steel production, would have been used in a commercially and environmentally sustainable manner. It is unfortunate that the conditions for finalizing the financing negotiations could not be met and that the development of the project has to be stopped,” says Matti Hietanen, CEO of Finnish Minerals Group.
Matti Hietanen, CEO, Finnish Minerals Group
Tel. +358 40 8238806