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Main page > Comments > Fuel & Energy > Plans to privatize Rosneft
Plans to privatize Rosneft
The Russian economic development ministry has suggested a new scheme of selling shares in some large state companies including Rosneft. The novelty is the intention to sell a 15% block of shares in the oil company on the market and to exchange a 10% minus one share stake for assets of some strategic investor.
Earlier deputy PM Igor Shuvalov promised the government could sell only 15% in the oil producer by 2015. One of the most intriguing questions in this story is whether the company's management will allow nonresidents to participate in privatization of Rosneft? On one side, in Russia there is quite a number of firms willing to acquire state assets and put them directly onto their balance or the balance of their affiliates. This is especially true in cases where managers of the assets put for sale are involved in the privatization process. Nonresidents are planned to be engaged in complicated production projects but not in share capital. Besides, lately nonresidents have left share capitals of Russian companies, e.g. ConocoPhillips withdrew from LUKOIL and rumors about E.On being ready to sell its stake in Gazprom.
On the other side, it is necessary to bear in mind close ties of Rosneft top managers with Chinese partners and numerous promises made to the latter on facilitating their work in Russia and organizing Russian gas exports to China. The company and the Russian government may have to take into account this factor. In this case there is a possibility that part of Rosneft shares may be purchased by CNPC.
By Stanislav Mitrakhovich, NESF leading expert
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