The Kryvyi Rih Iron and Steel Works (KZRK), one of the key assets of the Privat Group, is in critical condition. Almost all production has been stopped, and most employees have been placed on layoff until April 2025. Salaries and the further functioning of the enterprise remain in question. The formal reason is problems with product sales and the inability to pay for electricity. However, unofficially, the reason is deeper: Ihor Kolomoisky’s financial channels have been blocked, offshore schemes have been closed, and the company’s accounts are under international control.
The situation surrounding KZRK echoes the fate of the oligarch's other assets, such as Privatbank, Ukrnafta, and the Kremenchuk Oil Refinery, which were effectively taken out of his control due to financial fraud. Now the plant may become the next target for nationalization.
The main owner of the enterprise is the Cypriot company Starmill Limited, which formally owns 99.88% of the shares of KZRK. However, in fact, control belongs to the same structures that for years ensured the withdrawal of profits abroad. Now, when Kolomoisky has lost the ability to finance operational activities and maintain even a minimal level of social responsibility, the plant is on the verge of economic collapse.
Instead of official downtime, employees are offered to go on vacation at their own expense, which allows management to avoid obligations to pay salaries. This is a typical approach of the Ukrainian oligarchy, when responsibility for the crisis is placed on labor collectives, and profits are deposited offshore for years.
The plant has long signaled problems, including with tax refunds and a lack of state support. However, the current situation is not just economic difficulties, but the collapse of Kolomoisky’s management model. Given the trends, KZRK may become another asset that the state will be forced to take control of in order to avoid the complete collapse of the enterprise and a social explosion in the region.
