Shares in Ferrexpo PLC (LSE:FXPO) fell on reports that Ukraine has seized shares owned by the iron ore producer's major shareholder and former chief executive.
The Kyiv Economic Court confiscated stakes of 50.3% in the Poltava, Eristivskiy and Bilanivskiy mining plants in central Ukraine, which it said were indirectly owned by billionaire Kostyantin Zhevago through Ferrexpo, according to a statement.
Other associated companies are prevented by the court from "alienating" these assets, Interfax reported.
At the request of Ukraine's Deposit Guarantee Fund, the court decided to "arrest" the stakes as part of compensation claims over Zhevago's collapsed Finance & Credit Bank, where he remains under investigation over the disappearance of US$113mln.
Zhevago has denied any wrongdoing.
"This decision is another step to protect the interests of the creditors of the Finance & Credit bank," said Viktor Novikov, deputy managing director of the Fund in a statement.
The fund said it was seeking to recover nearly 46bn hryvnias ($1.25bn) in damages and that Zhevago tried for a long time to hide which assets he owned.
Zhevago was arrested in France last year and released on a €1mln bail in December.
He stepped down from his chief executive role at Ferrexpo in 2019 to focus on the accusations related to Finance & Credit, which he owned until its bankruptcy in 2015.
He was at the centre of a storm over controversial charity payments raised by former auditor Deloitte, where an independent review found a number of discrepancies connected to US$110mln of donations given to its Ukraine charity partner.