Currency converter
All news
News Search Topics
Use filter
You can filter your feed,
by choosing only interesting

Russian govt confirms VTB privatisation despite Western sanctions

July 30, 2014, 20:28 UTC+3 MOSCOW

There are 2,500 more enterprises across Russia that can be of interest to investors

1 pages in this article
Olga Dergunova, head of the Federal Agency for the Federal Property

Olga Dergunova, head of the Federal Agency for the Federal Property

© ITAR-TASS/Yuri Mashkov

MOSCOW, July 30. /ITAR-TASS/. The Russian government on Wednesday confirmed its plan to privatize the VTB bank despite Western sanctions against it.

“I cannot say what the economic or political situation will be like a year from now. Everything changes so quickly. But the asset must be in good economic condition to attract investors today, tomorrow and the day after tomorrow,” Olga Dergunova, head of the Federal Agency for the Federal Property, said.

She said the Agency was not revising privatization plans for VTB and the state-owned oil company Rosneft, which has also been affected by US sanctions.

Earlier this week, the United States announced a fourth round of anti-Russian sanctions which will apply to VTB, Rosselkhozbank and Bank of Moscow. They will not be allowed to borrow from American companies for a period of more than 90 days.

On July 16, the US government announced further sanctions against Russian officials and companies in Russia and Ukraine, including State Duma (lower house of the Russian parliament) Deputy Speaker Sergei Neverov, Minister for Crimean Affairs Oleg Savelyev, presidential aide Igor Shchegolev, Federal Security Service Colonel-General Sergei Beseda, and one of the leaders of the self-proclaimed Donetsk People’s Republic, Alexander Borodai.

The sanctions list also includes the Donetsk and Lugansk People’s Republics, Russia’s Vnesheconombank, Gazprombank, Rosneft, Bazalt, Feodosia Oil Company, Radio-Electronic Technologies Concern, Sozvezdie Concern, Almaz-Antey machine-building company, Kalashnikov Concern, KBP Instrument Design Bureau, Uralvagonzavod, and Novatek.

The Russian government was planning to sell 19.5% of shares in Rosneft and 11% of share in VTB this year.

Rosneft is the leader of Russia’s petroleum industry and the world’s largest publicly traded petroleum company. Rosneft activities include hydrocarbon exploration and production, upstream offshore projects, hydrocarbon refining, and crude oil, gas and product marketing in Russia and abroad.

The company is included in the list of strategic companies and organizations of Russia. The main company shareholder (69.50%) is OJSC ROSNEFTEGAZ, a 100% state-owned company. BP owns another 19.75%, and the remaining 10.75% of shares are publicly traded.

The Russian government plans to receive 3,000 billion rubles from the privatization of state-owned property in 2012-2016. This exceeds privatization revenues over the past 18 years.

In 2012, 202 billion rubles worth of state property were sold, 1.6 times more than in 2011; privatization revenues in 2013 amounted to 6.261 billion rubles.

By 2018, the number of joint stock companies in federal ownership will decrease 10 times, and the share of civil servants in such companies' governing bodies will be reduced to 30% during the same period.

There are 2,325 joint stock companies in the federal register of federal property. The combined value of all federal property is 12,000 billion rubles.

Prime Minister Dmitry Medvedev said only those assets would remain in federal ownership that secure strategic interests of the State.

The Russian government said earlier its privatization plan included more than 850 organizations, such as VTB bank, Sovcomflot, the United Grain Company, RusHydro, Sberbank, Rosneft, Rosagrolizing, Rosselkhozbank, Russian Railways Company, and others.

Russia will also continue privatizing state-owned banks after 2015.

According to the privatization plans, the government intends to reduce its share in Sberbank, VTB and Rosselkhozbank to 50% plus one share.

Subject to privatization will be large enterprises in the oil and oil transportation sector, air transportation, financial sector, machine-building, and defense industry.

There are 2,500 more enterprises across Russia that can be of interest to investors. These companies are engaged in wood processing, agriculture and other industries.

Show more
In other media
Partner News