Ukraine sells 25% in Donetskoblenergo, postpones sale of two stakes

Ukraine’s State Property Fund sold on Aug. 16 a 25%
stake in power DisCo Donetskoblenergo (DOON UK) at the starting price of UAH
143.8 mln (USD 5.6 mln), according to the fund’s website. There was only one
bidder at the auction, whose name was not disclosed.

The fund also reported on Aug. 15 that it got no bids
for 25% stakes in power DisCo Sumyoblenergo (SOEN UZ) and GenCo Donbasenergo
(DOEN UK), whose sale was also scheduled for Aug. 16. The two tenders have been
rescheduled for Aug. 23. Recall, the privatization of eight 25% stakes in
electricity companies for an aggregate starting price of UAH 4.1 bln (USD 160
mln) was scheduled for Aug. 15-31.

Alexander Paraschiy: It is very
likely that the only bidder in the auction was DTEK Energy (DTEKUA), Ukraine’s
largest electricity producer that is the owner of a  71%-plus stake in the
company. We expect DTEK will also participate in tenders for 25% stakes in
other companies it controls: Zakhidenergo (ZAEN UK) and Kyivenergo (KIEN UK)
scheduled for Aug. 18, as well as Dniproenergo (DNEN UK) and Dniprooblenergo
(DNON UK) scheduled for Aug. 30. If so, DTEK may spend up to USD 100 mln on the
acquisition of these stakes, using a significant part of its allowed investment
program for this year worth USD 480 mln.

If all these five stakes in DTEK-related companies
are sold, Ukraine will significantly boost its privatization proceeds as
compared to the previous four years, when proceeds amounted to UAH 0.15-1.48
bln.