Ukraine has hired advisors to help sell the first six companies on the privatisation list this autumn, the State Property Fund reported on August 3.

Ukraine’s privatisation programme has been gathering some momentum but it has struggled to sell the star companies that could bring in billions of dollars.

The advisors have been hired ahead of the latest push to get the programme moving again. The head of Ukraine's State Property Fund (SPF) Vitaliy Trubarov plans to sell 22 large companies, according to a post published on his Facebook page on June 11.

Earlier the cabinet produced a list of 23 companies, but the Zaporizhia Titanium Plant has been excluded for the meantime and will be sold by a simplified procedure (according to the old law on privatisation). The amended list includes five power supply companies, Centrenergo, Odesa Port Plant (OPP), Turboatom, Zaporizhia Titanium and Magnesium Combine, United Mining-Chemical Company and Sumykhimprom, amongst other names.

The nominating commission selected advisors last week for the privatisation of the first six assets that should be sold under the privatisation law adopted in January.

A company related to Concorde Capital was selected as an adviser for Kyiv-based President Hotel, pharmaceutical company Indar and coal mine Krasnolymanska.

A company related to BDO was selected as adviser to sell titanium ore producer United Mining-Chemical Company, KPMG was selected as adviser for power generator manufacturer Elektrovazhmash and Pericles Global Advisory was selected for the fertiliser producer Odesa Portside Plant (Odessa Port Plant (OPP). The sale of all the mentioned companies are supposed to be completed by the end of 2018.

The fund also announced tenders to select privatisation advisers for another group of companies, including petrochemical asset Oriana, chemical plant Sumykhimprom, financial company Ukragroleasing, machinery asset Azovmash and four small heat and power stations.

Investors will be watching the attempt to sell OPP closely, as previous attempts have failed twice already because of the company’s accumulated debts to oligarchs and the threat of legal action as the original sale of the plant has been disputed. The government tried to sell the plant last year, but cancelled the auction in September 2017 with intent of putting it back on sale in the spring of 2018.

The new law on privatisation stipulates that large state assets (controlling stakes in companies with over UAH0.25bn in book value of assets) should be privatised involving financial advisers. In June, the fund initiated the privatisation of 22 large assets under the new law.

“It’s positive to see the fund is moving forward with its earlier announced privatisation list, which it failed to do for the last four years. It’s unlikely that all 22 assets will be privatised in 2018, and it’s not likely that Ukraine’s UAH22.5bn ($830mn) privatisation proceeds target will be reached this year. But there is a chance that Ukraine will be able to boost revenue from sale of state property from the previous year’s result of UAH3.4bn,” Alexander Paraschiy of Concorde Capital said in a note.

And the privatisation programme maybe widened to include defence companies. The Ukrainian authorities are preparing a bill to lift restrictions on the privatisation of state defence enterprises, according to the National Security and Defence Council of Ukraine (NSDC) Secretary Oleksandr Turchynov.

However, privatisation is not popular with the general public. A poll earlier this year found that 47% of respondents oppose the possible privatisation of state-owned enterprises.

In 2017, the Ukrainian authorities obtained UAH3.244bn from the privatisation of state-owned assets. Kyiv restarted its privatisation drive in August, when the SPF sold blocking stakes in several power companies to System Capital Management (SCM) Group controlled by Ukraine's richest oligarch Rinat Akhmetov. At the same time, the government in Kyiv intended to meet its planned UAH17.1bn of privatisation revenues by the end of 2017.

In 2016, Kyiv obtained only UAH188.92mn from the privatisation of state-owned assets, or 1.1% of the UAH17.1bn plan set in the 2016 budget.