MOSCOW, May 25 (Itar-Tass World Service)
The Kremlin has invented new rules for selling state-owned fuel-sector companies. State-owned Rosneftegaz, with Igor Sechin back on its board of directors, was allowed to buy stakes in such companies at least till 2015. It is not clear however what and how it gets.
Rosneftegaz’ new role is defined in a presidential decree of May 22 published on Thursday, the Vedomosti newspaper writes. Before the beginning of 2015, the state holding company will be an investor into fuel-sector companies that are planned to be sold. The government must take it into account when drafting its sales plans, the decree noted. Rosneftegaz is obliged to make a program of fining its future deals on the basis of dividends from its current assets.
“[The decree] changes nothing in our privatization plans,” President Vladimir Putin said on Thursday. The question is what these plans are, the newspaper cites a government official. Dmitry Medvedev, when he was Russian president, wanted to speed up privatization, while Putin seems to be not so committed, the official said.
Fuel-sector companies are very important for the state, Putin noted. But it in no way means that the state may not reduces its share in such companies. As a matter of fact, he pointed, these companies are now underestimated while the state should derive weighty profits when it opts to sell its stakes.
In this context, market participants were curious about the future of Russia’s oil major Rosneft, in which the state as such holds only one share, while Rosneftegaz owns a-75.16 percent stake, since it is going to be an investor and buyer of state assets.
On Wednesday, former Deputy Prime Minister Igor Sechin became Rosneft president. He is also due to be back on Rosneftegaz’s board of directors (to chair it, officials say). It looks like his key task to maximally consolidate Rosneft to make a kind of oil-sector Gazprom, officials from the government, the Kremlin, the ministry of energy, and Sechin’s colleagues told the Vedomosti. According to source close to the ministry of energy, several years ago Sechin pushed the ides of consolidating such companies as Rosneft, Zarubezhneft, Transneft, Transnefteproduct, and Surgutneftegaz into Rosneftegaz.
However, officials prefer not to dwell on the idea officially. Thus, Minister of Economic Development Andrei Belousov on Thursday vowed that new decrees by no means spell the death of Rosneft privatization plans. Everything will depend on the market situation, on “certain restrictions of the market character,” he said.
Having appointed Igor Sechin president of Rosneft, the state is seeking to consolidate fuel and energy sector assets on the base of Rosneftegaz, the Kommersant daily stresses. Under the new presidential decree, the company will be authorized to take part in the privatization of state-owned companies and in the buying private companies of the fuel and energy sector. Key candidates for merger are Transneft, Zarubezhneft, and Surgutneftegaz, let alone state-owned energy companies. Rosneftegaz will pay for new assets from its incomes, which means that the state budget will lack the 89 billion roubles planned to be earned from the company’s dividends.
Experts however doubt the efficiency of privatizing fuel-sector companies in favour of Rosneftegaz, the newspaper notes. International experience proves that practices of managing the sector through holding companies are not that efficient, says Valery Nesterov of Troika Dialog. He believes the market will take such a structure negatively: it may turn out that the state does not have resources enough to develop all of its assets. According to Konstantin Cherepanov of UBS, the sale of assets to Rosneftegaz is not a privatization proper. Moreover, it may tell negatively on the country’s budgetary incomes plans. Under the law on the federal budget for 2012 and for a larger period of 2013 and 2014, the state is to derive a profit of 89 billion roubles from Rosneftegaz’s dividends, or at least 95 percent of net profits a year. A source in the ministry of finance told the Kommersant that the country’s ministry of economics and the state property management agency will elaborate proposals how to compensate possible losses, since they were behind the decree.
The state seeks to use Rosneftegaz to get a better price for state-owned fuel sector assets in the course of privatization, the RBC daily cites Alexander Shtok, due diligence department director with 2K Audit-Business Consultations. “In case other investors are passive, it will be Rosneftegaz that is to offer a good price. And the holding will be bargaining until a fixed price level is reached,” he said.