Cabinet of Ministers puts forward 15 Oblenergo stakes for sale

The Cabinet of Ministers approved a decision to privatize controlling stakes in 15 Oblenergos, Acting Chairman of the State Property Fund Dmitriy Parfenenko said yesterday at a press conference. Parfenenko said that given necessary procedures to prepare for the sales, the first privatization tender could be announced in September 2009. The National Energy Company of Ukraine current holds the following stakes in Ukrainian utility companies: 75% of Vinnitsyaoblenergo, Dniprooblenergo, Volynoblenergo and Zakarpatoblenergo; 65.06% of Donetskoblenergo; 60.25% of Zaporizhoblenergo; 50%+1 of Kyivenergo; 70% of Krymenergo, Mykolaivoblenergo and Chernivtsioblenergo; 51% of Ternopiloblenergo; 65% of Kharkivoblenergo; 70.01% of Khmelnitskoblenergo; 46% of Cherkasyoblenergo; and 25.01% of Odesaoblenergo. Yegor Samusenko: We see this news as positive for the illiquid Oblenergo sector. Though, we don’t expect the SPF to sell more than half of the companies this year. Of the state’s recent privatization tenders for Oblenergo stakes, only two were held, and three more have been delayed every week due to the absence of bidders. For these auctions, the SPF used the six-month average mid price on the PFTS to determine the starting price of the auction, thus with this new announcement, we might see attempts to push up Oblenergo prices before privatization.