The Kremlin has reprimanded VTB Capital, the organiser of the privatisation of Bashneft, for opening up the sale of the Russian government's 50.1% stake in the oil major to other state companies, including Rosneft, Gazprom, Gazprom Neft and the Russian Direct Investment Fund (RDIF).

Banking sources told RBC Daily on July 21 that Deputy Prime Minister Arkady Dvorkovich was extremely dissatisfied with VTB's decision to extend the offer to Rosneft as this contravenes direct instructions of President Vladimir Putin to exclude state-owned companies from the sale, which is expected to follow this month's successful sale of a 10.9% stake in diamond miner Alrosa.

The law on the privatisation of state and municipal property prohibits the participation of companies with a government share of 25% or more. Among companies that received VTB's invite, Gazprom and the Russian Direct Investment Fund fall under the prohibition. The state holds indirect control in Rosneft and Gazprom oil through Rosneftegas (69.5%) and Gazprom (72.7%). However, Putin's order bars Rosneft from touching the Bashneft privatisation.

VTB Capital in writing approached more than 50 potential strategic investors, with the offer standing until July 25, it was reported. So far, the independent Lukoil has given the strongest indication of its wish to buy the company, saying it was ready to pay a premium price.

In 2016-2017, the government plans to partially privatise some of the largest state-owned companies: 50.1% of Bashneft, 19.5% of Rosneft, 25% of Sovcomflot and 10.9% of VTB. In early July, the 10.9% Alrosa stake went for RUB53.3bn ($846mn) on the Moscow Stock Exchange.