Parliament Adopts Law Reducing Shareholder Meeting Quorum to 50%

Parliament today adopted a bill that would reduce the minimum quorum for shareholder meetings to 50% plus one share, from the current minimum of 60% plus one share. Currently, large minority shareholders with stakes of at least 40% are able to block shareholders meetings from being held, and thus to block crucial decisions including changes of management. After the law is signed by the speaker and sent to the president, the president has up to 15 days to either sign it into law, or return it to parliament. If signed, the law would take effect on January 1, 2007. Tom Warner: There is a big chance that President Yushchenko will veto this bill, as he has recently allied himself with the Privat Group, which would be the biggest loser if this bill became law. The traded companies that could be affected include Ukrnafta (UNAF:SELL) (state owns 50% plus one share, Privat group >40%), Kievenergo (KIEN:BUY) (state owns 50% plus one share, city together with the Vasyl Khmelnitsky group >40%), ZaporizhCoke (ZACO:BUY) (SCM and ARS own >50%, Zaporizhstal group >40%), and several Oblenergos. The bill could also affect the long-running conflict at Kyivstar, where Norway’s Telenor owns 53.5% and Russia’s Alfa Group 46.5%.