Government Approves Updated Privatization Conditions for Four GenCos

Ukraine’s Cabinet of Ministers yesterday approved the updated privatization conditions of four electricity generation companies: Centrenergo (CEEN: HOLD), Dniproenergo (DNEN: HOLD), Donbasenergo (DOEN: BUY) and Zakhidenergo (ZAEN: HOLD). According to the new conditions, a 60%+1 stake in each company would be sold to strategic investors, while 10% to 26% stakes will be placed on stock exchanges. Alexander Paraschiy: Privatization of these four generation companies in 2008 still looks unlikely. The largest obstacle in place is for the Ministry of Fuel and Energy and the Ministry of Finance to agree on the distribution of privatization proceeds (see our news comment of March 21). Additionally, the uncertainty surrounding the government’s stake in Dniproenergo would need to be cleared up (see our note of March 24).