Kyivenergo appoints new CEO loyal to DTEK

Yesterday Eduard Sokolovskiy replaced Serhiy Titenko as CEO of Kyivenergo (KIEN: HOLD), as decided by the company’s supervisory board. Alexander Paraschiy: With this appointment, DTEK, which was rumoured to have gained control over Kyivenergo, implicitly takes over operations. Before July 25, 2008 Sokolovskiy was the CEO of electricity distribution company Dniprooblenergo (DNON: BUY) and represented DTEK’s interests there. On July 25, the majority shareholder of Dniprooblenergo, the National Electricity Company of Ukraine, dismissed Sokolovskiy by force. We believe under full operating control by DTEK, Kyivenergo will manage to reduce the coompany’s excessive electricity losses in grids (one of the highest in the sector) and lobby for increased heating tariffs to fully cover heat production costs.