Ukraine will postpone the sale of state-owned Odesa Portside Plant (OPP) to January-February 2016, the head of Ukraine's State Property Fund (SPF) Ihor Bilous told journalists on September 2.
"The key reason for postponing the competition [is] the parliament's adoption of the law on the abolition of compulsory sale of the company's 5% stake [separately from the main state-controlled stake], as well as the execution of all procedures for the organisation of the competition and the search for privatisation adviser," Bilous said.
According to Ukrainian legislation, the national authorities should offer a 5-10% stake in the company to potential investors on the stock exchange.
Previously, the Ukrainian government, which holds a 99.57% stake in OPP, wanted to sell the port in November-December. Privat Group, controlled by Ukrainian oligarch Igor Kolomoisky, is likely to be one of the main bidders for the asset.
Bilous also said that the SPF is considering three European investment banks as candidates for the role of privatisation adviser for OPP. The memorandum with the winner could be signed within the week, he added.
OPP is a major chemical production company accounting for 17% of Ukraine's ammonium nitrate capacity and 19% of urea production capacity. Due to its strategic location and connections to the chemical transportation infrastructure, the plant is export-oriented: export sales constitute up to 85% of the output, while the major export destinations are the EU and US.
On August 18, Bilous said the starting price for a stake held by the state in OPP will be no less than $500mn. He added that ten potential investors have already expressed interest in the company, while the authorities plan to attract a global investment bank as adviser for the privatisation by the end of August, while a road show for investors will begin in September.
In late August, Adomas Audickas, a senior advisor to the Ministry of Economic Development and Trade told bne IntelliNews that the SPF wants to sell OPP as soon as possible, adding that such a "sizeable asset in the region" is already well known to potential investors.
"We expect that we will have strong competition for such kinds of assets," Audickas said.
The Ukrainian government has drafted a list of 345 companies due for privatisation. In cluding OPP, the authorities are ready to sell 302 of the enterprises straight away, while the remaining 43 will be sold after the parliament approves amendments to some Ukrainian laws.
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