Uzbek State to Sell 100% Stake in ‘Fonon’ Jewelry Plant Valued at 316.7 Billion UZS

The State Assets Management Agency of Uzbekistan has put up for auction its entire 100% stake in the company owning the "Fonon" jewelry plant, "Gold Moon Tashkent". The starting price of the state share has been set at 316.7 billion Uzbek soums (UZS), with the auction scheduled to begin on September 28.

Financial and Operational Overview

"Gold Moon Tashkent" reported a net profit of 33.4 billion UZS in the first half of 2026, a significant turnaround from previous years when the company operated at a loss. Despite this, the company’s financial position remains fragile, with total assets amounting to 443 billion UZS as of July 1, while liabilities exceed 550.3 billion UZS, resulting in negative net assets of approximately 107.3 billion UZS.

"Although the company demonstrated profit growth in early 2026, its balance sheet continues to reflect a substantial debt burden, with liabilities surpassing assets by over 100 billion soums."

At the end of 2025, negative net assets stood at 140.8 billion UZS, indicating a modest improvement of 33.5 billion UZS over six months. The company's revenue in 2025 totaled 413.8 billion UZS, a slight decline of approximately 1% compared to 2024. Net losses narrowed from 12.3 billion UZS in 2024 to 7.8 billion UZS in 2025.

The buyer will assume all creditor and debtor obligations of the company, which includes creditor debt of 305.9 billion UZS and debtor claims amounting to 13.2 billion UZS. Additionally, commercial bank liens are registered against the company’s buildings and facilities located on a 2.56-hectare site in the Chilonzor district of Tashkent. The specific bank and the nature of these liens have not been disclosed.

Asset and Operational Footprint

"Gold Moon Tashkent" holds assets including buildings and structures with a total area of 11,370 square meters and fixed assets valued at 110.7 billion UZS, with a depreciation rate of 33.2%. The facility was established in 2021 on the basis of the former scientific and production enterprise of the same name, with a project valuation initially estimated at around 21 million USD and an annual production capacity of six tons of jewelry products.

However, the auction does not include the "Fonon" jewelry house brand or its retail network. Despite sharing the brand name, the jewelry plant and the retail operator "Empire Jewelry" LLC are legally separate entities. The auction documentation covers only the sale of the 100% state stake in "Gold Moon Tashkent".

Auction Terms and Strategic Considerations

Participation in the auction requires a deposit of 9.5 billion UZS, with bidding increments set at no less than 5% of the starting price (15.8 billion UZS). The purchaser will be granted the option to pay the purchase price in installments over 36 months. If the initial payment is below 35%, interest will be charged on the remaining balance at the Central Bank’s base rate.

Notably, the auction terms do not stipulate mandatory investment commitments or employment guarantees from the buyer, a factor that could influence the strategic direction and potential restructuring of the company post-sale.

There is a discrepancy in reported employee numbers: auction documents list an average annual workforce of 459 employees, whereas the company’s official passport indicates 309 employees. The reason for this difference remains unexplained.

Implications for Market and Investors

The sale of "Fonon" jewelry plant represents a significant opportunity for investors seeking entry or expansion in Uzbekistan’s jewelry manufacturing sector. However, the substantial creditor debt, existing liens on key assets, and absence of mandatory post-sale investment obligations impose considerable risks.

Potential buyers will need to carefully assess the company's liabilities structure and operational prospects, including decisions regarding modernization, production capacity utilization, and workforce management. The government’s readiness to accept a phased payment plan may alleviate upfront capital requirements but extends the financial exposure linked to the asset.

The strategic positioning of the "Fonon" plant within the regional jewelry market, combined with its recent return to profitability, could provide a foundation for turnaround if managed effectively under new ownership.