Ukraine fails to sell 25% in Sumyoblenergo

Ukraine’s State Property Fund was not able to sell its
25% stake in power DisCo Sumyoblenergo (SOEN UZ) at its Aug. 23 auction, the
Interfax-Ukraine news agency reported the same day. The only registered auction
participant did not confirm its bid at a starting price of UAH 370 mln. The
fund has scheduled another auction of the Sumyoblenergo stake for Aug. 30, at
the same starting price.

Alexander Paraschiy: Out of
eight 25% stakes in power generation and distribution companies that are up for
auction, the public is interested in only five stakes, all of which are
controlled by Rinat Akhmetov’s DTEK Energy. (Sumyoblenergo is controlled by
other oligarchs.) Out of six stakes already put on the auction block, only
three have been purchased and they are all controlled by DTEK, which was the
buyer as well.

This week, Ukraine will have its last chance to
offer three stakes that failed to draw buyers in the last two weeks. We expect
a low chance of success. On the other hand, the government has strong chances
to sell two other DTEK-related companies – DisCo Dniprooblenergo and GenCo
Dniproenergo – for the first time on Aug. 31. If the latter stakes are sold
successfully, Ukraine’s 2017 privatization proceeds will be about UAH 2.6 bln,
or more than the last four years, cumulatively.