Rada Approves 2007 Privatization List

At its afternoon session yesterday, the Verkhovna Rada approved a list of companies to be privatized in 2007. The list includes small stakes in 21 energy companies, 28 companies from the coal industry and  big names like Ukrtelecom (UTEL: BUY), the Odesa Portside Fertilizer Plant, Luhansktepolvoz (LTPL: HOLD), Kharkiv Traktor and Rosava (ROSA). The 2007 Budget calls for revenues of USD 2 bln from privatizations.  Nick Piazza: With the inclusion of UTEL on the new list all the pieces are in place for the state to reach its privatization revenue target, the only obstacle left is political will. The State Property Fund (SPF) has done a poor job of reaching the government’s 2006 privatization target of USD 420 mln (as of November the SPF had brought in only about 15% of this amount) and its leader Valentina Semenyuk has made it no secret she is against UTEL’s privatization, which leaves the task of pushing privatizations forward on the Cabinet’s shoulders and it is unclear how interested the Eastern Ukrainian business groups behind Yanukovich’s Cabinet are in seeing UTEL privatized in 2007. However, if the Cabinet needs to make ends meet, UTEL would go a long way towards filling the State’s coffers. Privatizations on the list that look like safe bets include the State’s coal sector assets, LTPL (whose cause the SPF has been championing lately), and some of the smaller energy sector stakes.