Uzbekistan's economy and finance ministry has registered an additional share issue of ferrous metals plant Uzmetkombinat worth $175mn, Spot reported, citing the company's press service.

The supervisory board of the company decided to issue common and preferred shares at a meeting on March 16. The capital raised will finance an investment programme aimed at doubling the production capacity of the plant.

Uzmetkombinat is issuing 177,626,648 ordinary and 141,577,773 preferred shares. Current shareholders who are owners of ordinary securities are to receive a preferential right to purchase new shares in proportion to their existing stake.

The main buyer of the shares will be the Fund for Reconstruction and Development of Uzbekistan. Its stake in the company is expected to exceed 35%, with the total state-held stake moving to 88% of ordinary and 93% of preferred shares.

The outstanding ordinary shares will be placed by Abu Dhabi Uzbek Investments Company, which became a shareholder of the plant in 2022.

"Taking into account our experience of working with local and foreign investors in Uzbekistan, we can note the importance of building long-term trusting relationships between the company and shareholders," said Karen Srapionov, managing partner at Avesta Investment Group. "In this regard, we warmly welcome the efforts of the management of Uzmetkombinat to grant the pre-emptive right to purchase shares to existing shareholders in full compliance with the legislation."

AFC Uzbekistan Fund, one of the first foreign investors in the plant's shares, plans to take part in the follow-on public offer (FPO). Its managing director Scott Osheroff noted the "significant development potential of the company" and said that the fund would consider the possibility of additional investment.

Founded in 1944, Uzmetkombinat is the only ferrous metallurgy plant in Central Asia.