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(Sharecast News) - Shares in London-listed miner Ferrexpo tanked on Tuesday after the company said a civil claim worth 157 billion Ukrainian hryvnia (3bn) had been filed against its Ukrainian unit Ferrexpo Poltava Mining (FPM) in relation to alleged sale of waste products from the production of iron ore pellets.
Shares in the company were down 40% in late London trade. Ferrexpo said initial accusations on the illegal sale of waste products "have transformed into accusations that FPM is illegally mining and selling subsoil (minerals other than iron ore), which is said to have caused damage to the environment".
"FPM rejects these allegations in their entirety on the basis that there was no illegal extraction of the subsoil. FPM mines and extracts iron ore according to its mining licence."
Ferrexpo, which exports the pellets to steel makers, added that based on information received by the group and with advice from Ukrainian legal counsel, the accusations and claim "are without merit and FPM intends to vigorously defend its position in the Ukrainian courts".
"The operations of the group remain unaffected. Further updates will be made on the situation as and when appropriate."
Reporting by Frank Prenesti for Sharecast.com
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