Ukraine initiates another attempt to privatize Centrenergo
Ukraine’s State Property Fund issued an order on July 23 to initiate a privatization process of power generation company Centrenergo (CEEN UK), reform.energy news site reported on July 26. The order assumes offering a 78.3% stake in the company on an electronic auction by end-2021. In the near future, the fund should create an auction commission and select a privatization advisor. At the same time, the fund’s deputy head commented to reform.energy that the company’s privatization is planned for the year 2022. Before that, the government is going to merge Centrenergo with some of its coal mines to create a vertically integrated coal and power company. Thus far, no such mines have been selected.
Recall, Ukraine was closest to selling the 78.3% stake in Centrenergo in December 2018, when a privatization auction was planned with a starting price of about USD 215 mln. However, the auction was cancelled as two potential participants were disqualified.
Alexander Paraschiy: The year 2022 looks realistic for Centrenergo’s privatization tender, providing the government makes a final decision on its merger with state mines in the near future. If that happens, the state’s stake in a combined company should significantly increase. Theoretically, such merger could add some value to the power company, which is competing now with a vertically integrated private coal and power holding DTEK.