A new privatisation tender for a 99.567% stake in Ukraine's state-owned Odessa Port Plant (OPP) failed, Prime Minister Volodymyr Groysman said on December 7, castigating authorities responsible for selling the giant chemical-producing facility.

Its successful sale is regarded as a linchpin of Ukraine's privatisation process and crucial to winning confidence of cautious foreign investors.

"The recent tender to privatise Odesa Port Plant has showed that the institution [State Property Fund - SPF] is absolutely unable to effectively conduct privatisation and unable to manage state-owned property," Interfax news agency quoted Groysman as saying during a government meeting in Kyiv. "I would dismiss everyone who manages SPF if this were in my power, everyone would have been fired."

The tender was unsuccessful despite the fact that new starting price for the stake in the southern coastal plant stood at UAH5.16bn ($200mn), while the bid increment is UAH150mn ($5.9mn).

In July, the first tender for the same stake flopped due to a lack of bids from investors. This was attributed to the burden of OPP's $250mn debt to the Ostchem company of Ukrainian oligarch Dmytro Firtash and an unresolved conflict with Nortima, allegedly controlled by billionaire Ihor Kolomoisky.

As well as being a setback for the Ukrainian authorities, the failed landmark sale raises questions about the plant's further viability. Government officials had said they must sell OPP this year or the plant will go bankrupt.

The new starting price of the asset retained a key requirement that the buyer must  repay the plant's debt to state natural gas supplier Naftogaz. Meanwhile, analysts in Kyiv say that at current gas and fertiliser prices, OPP will generate $35mn in operating losses in the fourth quarter.

The SPF confirmed that no bid was submitted to the tender to sell the plant. "Potential investors have not submitted bids to participate in the tender," the fund said in a statement. "Around 10 potential buyers showed their interest in the plant. Four potential buyers, most of them are foreigners, sent letters of intent to buy the plant's shares. They signed confidentiality agreements with the SPF. They were drawing up a package of required documents, but have not submitted bids to participate in the tender."