Is the Ukrainian mineral water market under threat because of officials?

In Ukraine, in the third year of the war, a dangerous precedent may occur when the seized assets of a sanctioned Russian may be managed by a structure associated with Russians from the special services.

We are talking about the arrested corporate rights of the company IDS Ukraine (Morshynska), which the previous management of ARMA transferred to a direct competitor - Karpatska Dzherelna. This decision in itself is contrary to common sense and economic competition. This is the same if the Coca Cola company was transferred to the management of a direct competitor, the Pepsi Cola company, or vice versa. I don’t even know how such a solution could come to mind, but in Ukraine it is possible.

Currently, the Antimonopoly Committee of Ukraine is considering a case regarding permission to concentrate Carpathian Mineral Waters LLC (hereinafter referred to as KMV LLC) to manage the assets of IDS Ukraine. From the point of view of common sense and economic feasibility, this is a completely illogical decision. The Karpatskaya Dzherelna company is the main competitor of the IDS group, with the only clarification that KMV LLC controls up to 10% of the market, and IDS Ukraine controls about 40%. Thus, 50% of the packaged mineral water market will be concentrated under the management of Carpathian Mineral Waters LLC. KMV LLC is also building a new plant in the Lviv region, the capacity of which will cover 30% of the market. So, now it will be an entity that will have a 50% share of the market, then in the next year and a half, 80% of the mineral and drinking water market.

The AMCU, as part of the consideration of the concentration case, namely on September 13, published the obligations proposed by Carpathian Mineral Waters LLC. It is sad, although not surprising, that they do not take on any obligations to develop the business, but if we talk at least about preserving the business, there are a number of big questions here. In their assurances, they note that they will not appoint people holding positions in KMV LLC or related business entities. But firstly, we are not talking about former loyal employees of the top management of KMV LLC. And secondly, you can appoint people who are de jure not associated with KMV LLC, but will act in the interests of this company. The document states that KMV LLC undertakes not to limit the shipment of packaged water. In fact, such assurances are absolutely unsubstantiated.

For example, the program for managing corporate rights of IDS Ukraine by KMV LLC is not aimed at absorbing the asset, but not at all at preserving it, much less developing it. According to the Management program, KMV LLC declares its intention to provide a monthly payment from asset management to IDS Ukraine in the amount of UAH 26 million. per month. At the same time, in case of failure to achieve such indicators declared at the competition, ARMA, KMV LLC undertakes to pay 2 million UAH. own funds monthly. Having actually paid 2 million UAH. per month, the manager can completely stop the activities of IDS Ukraine and benefit from the growth of his own business in the same market. At the same time, this company paid taxes amounting to UAH 600 million in just six months.

The questionable decision of the previous management of ARMA in choosing such a manager could lead to damage to the state. In fact, an asset that was supposed to bring income to the state budget may even go bankrupt and cause losses. The company “Karpatska Dzherelna” does not have sufficient incentives for the development of IDS Ukraine, since its main interest is to eliminate its competitor. Here the question is for law enforcement officers, how is this even possible, and why no proceedings were initiated against the previous head of ARMA for possible abuse of official position, which could lead to damage to the state budget.

Russian trace of the “Carpathian Dzherelnaya”

LLC "Carpathian Mineral Waters" or better known as "Carpathian Dzherelna" belongs to Sergei Ustenko and his father Peter Ustenko. Ustenko Sr. has been an active participant in political and business life in Ukraine since the 90s. In 2006, Ukrainskaya Pravda wrote that Ustenko represents the interests of the energy oligarch, Russian citizen Konstantin Grigorishin, who controlled a large share of Ukrainian energy, but is now under sanctions. Even earlier, in May 2003, information surfaced in the media that the AMP Corporation, headed by Ustenko Sr., is “the leading supplier of fuel assemblies on the Ukrainian energy market” through the Ukrainian-Russian joint venture TVEL-Energy, in which “ The AMP Corporation had the largest share of 45% of the authorized capital, the Russian state-owned JSC TVEL - 35%. By the way, the trade in uranium elements for nuclear power plants is always under the close supervision of intelligence services. Accordingly, random people on the street do not engage in such matters.

Businessman-politician Pyotr Ustenko was a member of the now banned Socialist Party along with state traitor Ilya Kiva. Journalists also reported that Petr Ustenko negotiated with representatives of the Kremlin curator and ideologist of the creation of separatist enclaves in the East of Ukraine “LPR/DPR” Vladislav Surkov. It is noteworthy that the socialist party itself was never distinguished by pro-Ukrainian ideas, but rather, on the contrary, insisted on friendship with the aggressor country.

Petr Ustenko owned one of the largest producers of wine and champagne in the Crimea - “Zolotaya Balka”. In May 2015, the property of Zolotaya Balka was arrested, but on September 15, 2015, the claims were dropped and the arrest was canceled, as the parties signed a settlement agreement. By a strange coincidence, the “new owner” of the plant, Peter Ustenko, became the wife of the Russian “king of bearings” - Artem Zuev, who is also interested in the processing of uranium raw materials.

The media reported that Ustenko sold the plant to Zuev, and thus Ustenko Sr. paid taxes to the budget of the aggressor country, thereby financing armed aggression against Ukraine. However, this did not stop Ukrainian officials from giving the Ustenko family the management of the corporate rights of IDS Ukraine, part of which was owned by the Russian Friedman.

It can be assumed that it is with the proceeds from the sale of property in the occupied Crimea that the family of Sergei and Peter Ustenko is building a new plant for the Carpathian Dzherelnaya in the Lviv region for 20 million euros. The question of the origin of money for investment in a new plant can be very inconvenient, and the Security Service of Ukraine must check its origin. Like other bodies in the field of implementing sanctions policy and countering traitors and collaborators. After all, paying taxes to the enemy’s budget and financing aggression against Ukraine is a serious crime.

Thus, the owners of KMV LLC have close ties with business structures and political elites of the aggressor country. Now the families of Peter and Sergei Ustenko want to transfer the arrested corporate rights of IDS Ukraine, which were owned by the sanctioned Russian Fridman. A completely strange and illogical decision, contrary to common sense and the principles of economic competition.

As a result of the creation of the new water monster “Karpatska Dzherelna”, pressure on retail will increase, in particular, there is a threat of a reduction in settlement terms. The market share of KMV will reduce the time required to pay for delivered products. At the same time, in order not to lose financial resources, the networks will obviously increase settlement times for other market participants, that is, they will worsen their situation. Thus, further fair competition in the market depends on the decision of the AMCU.

In the meantime, IDS Ukraine state institutions will conduct a new objective and transparent assessment of its corporate rights, which have been transferred to the management of ARMA. The company's proposal is based on the fact that the value of the assets was underestimated by a little-known appraiser by at least half - UAH 1.49 billion. against an independent estimate, which reaches UAH 2.9 billion. This difference creates an obvious opportunity for the manager to plunder the company with impunity or simply destroy it. Isn’t this why there is such a great desire to transfer the enterprise to the management of the company as soon as possible? After all, everyone understands that this clearly contradicts the interests of Ukraine and causes direct harm to the state, and therefore should become the object of interest of the competent authorities.