Ukraine sells power DisCo Volynoblenergo for UAH 462 mln

The State Property Fund of Ukraine announced on Dec. 24 it sold the government’s 75% stake in power distribution company Volynoblenergo (VOEN UK) at UAH 462 mln. UkrCitGaz, the owner of Kharkiv Heat and Power Plant #5, was recognized as the tender’s winner, the Fund reported. The other tender participant was an affiliate of VS Energy.

The sale price, UAH 1.29/share, was at a 1.3% premium to the tender’s starting price and 175% premium to the company shares’ market price (based on the last deal on the Ukrainian Exchange).

Alexander Paraschiy: This is probably the Fund’s most successful deal of 2013: the company was sold at a 2012 EV/Sales ratio of 0.9x and 2012 EV/EBITDA ratio of 17x. It’s also the Fund’s second-biggest sale in 2013 (after the sale of a 60.8% stake in Donbasenergo), which enables it to increase total proceeds from privatization by almost a half to UAH 1.45 bln this year.

Nevertheless, the SPF’s total privatization proceeds are only 13% of the Fund’s 2013 privatization plan (which was set at UAH 10.9 bln). The Ukrainian government still retains 25%-71% stakes in seven regional power distribution companies, the privatization of which might potentially bring to the state up to UAH 3 bln. The 2014 privatization plan has been ambitiously drafted by the state budget at UAH 17 bln.