Mykolaiv Awards ₴60M Boiler House Modernization Contract Amid Corruption Concerns

Mykolaiv held an auction to modernize a boiler house for 60 million. The winner was a company whose director has ties to local authorities and was suspected of embezzling budget funds.

This was reported by the Center for Public Investigations with reference to the Prozorro procurement platform.

Recently, a second auction for the modernization of a boiler house was announced in Mykolaiv. More than UAH 60 million was allocated for this purpose. The reconstruction of the boiler house of theregional utility company Mykolaivoblteploenergo is planned.

In early March, the company had already announced a tender for the reconstruction of the boiler house, and the auction was to take place on March 27. The contractors were required to provide documentary evidence of their experience in fulfilling similar contracts, as well as the availability of qualified specialists and workers. However, the auction was canceled due to excessive requirements for participants.

The auction was held on April 7 and was attended by two bidders, Promstan Corporation and CITY STARS. The latter won the auction and is currently awaiting a decision.

Screenshot: Prozorro

According to the Youcontrol online service, City-Stars has been on the market for about four years. The main KVED is the construction of residential and non-residential buildings. The owners of the company are Dmytro Kurbatov and Mykhailo Zhendubaiev from Mykolaiv. The latter also owns Mykolaivmiskbud, which, according to the Center for Public Investigations, is related to Olga Vidina, the former head of the municipal property department of the Mykolaiv Regional State Administration.

Last year, according to media reports, the Department of Housing and Communal Services of Mykolaiv City Council signed an agreement with the company to restore the building. A possible prepayment was found in the estimate.

Since its inception, City-Stars has participated in four public procurements, earning over UAH 46 million. In terms of total revenues, they are many times higher. While in 2023 the amount of total revenues was 2.5 million, in 2024 it has already exceeded 90 million. The company has no criminal investigations.

Screenshot: YouControl

Another company of Mykhailo Zhendubayev, Mykolaivmiskbud, has already been involved in both journalistic investigations and criminal cases. But this did not prevent the company from receiving a 78-million-dollar contract to modernize the pumping station. The firm has been repeatedly accused of ties to local authorities, corruption, and price gouging.

Earlier, Mykolaivmiskbud was suspected of artificially inflating the cost of materials for the construction of the water supply system, as well as colluding with local government officials to embezzle budget funds. Due to the breach of contract, the prosecutor's office succeeded in terminating the agreements between the company and the city planning department of Mykolaiv regional state administration.

Анна Бальчінос