Appellate Court Brings LTPL Privatization Closer to Reality

The Kyiv Appellate Economic Court threw out an appeal by Privat-Intertrading against the State Property Fund (SPF) to block the privatization of Luhanskteplovoz (LTPL: HOLD). The decision reverses a Kyiv Economic Court verdict from September 2006 to prohibit the sale of the state’s 76% stake in Luhanskteplovoz. The case was one of three that were blocking the privatization from moving forward. Olha Pankiv: We view the court’s decision as the first step toward fulfilling the SPF’s plans to sell Luhanskteplovoz in 2007, and expect the other two verdicts blocking the privatization (from Ukrzaliznytsya and physical person) to be cancelled soon. The appeals, though overridden, still might make the SPF change the conditions of the privatization tender to make them less biased toward Transmashholding (Russia). This would attract more participants and increase the purchase price. Nevertheless, we still view Transmashholding as the most likely to win the tender.