The State Property Fund of Ukraine approves 2015 Privatisation Schedule for Groups C and D companies

CMS Cameron McKenna, 
Kyiv, Ukraine, Tue, July 21, 2015

The State Property Fund of Ukraine (the “Fund”)has recently approved a schedule for privatisation of Groups C and D* state-ownedcompanies in 2015 (the “Schedule”).

The Schedule divides Groups C and D objects intothe following three categories: (1) companies to be put on sale through tenderswith open price offers (using the auction principle), (2) companies to be puton sale at stock exchanges and at regional open cash auctions, and (3)companies that will be put on sale following a decision of the Cabinet ofMinisters of Ukraine on their privatisation and/or transfer of their stock tothe Fund.

Below are some examples of the companies, byreference to a category, to be put on sale through December 2015.

Within category (1) the sale is scheduled asfollows:

·          September:a 70% stake in Mykolaivoblenergo Public Joint Stock Company (“PJSC”), a70.009% stake in Khmelnytskoblenergo PJSC, a 50.999% stake in TernopiloblenergoPJSC and a 50% stake in Ukrnaftoprodukt PJSC;

·          October:a 65.001% stake in Kharkivoblenergo Joint Stock Company;

·          November:a 94.99% stake in Odeska CHP PJSC, a 94.833% stake in Khersonska CHP PJSC and a94.567% stake in Odesa Port Plant PJSC;

·          December:a 55.248% stake in Zaporizhzhiaoblenergo Open Joint Stock Company (“OJSC”)and a 94.995% stake in Sumykhimprom PJSC.

Within category (2) the sale is scheduled asfollows:

·          July:a 5% stake in of each of Odesa Port Plant PJSC, Odeska CHP PJSC, and KhersonskaCHP PJSC;

·          August:a 25% stake in each of DTEK Dniprooblenergo PJSC, DTEK Dniproenergo PJSC,Kyivenergo PJSC and DTEK Zakhidenergo PJSC;

·          September:a 5% stake in Zaporizhzhiaoblenergo OJSC;

·          November:a 25% stake in Odesaoblenergo Energy Company PJSC and a 100% stake in MeridianAviation Special Purpose Company PJSC;

·          December:a 25% stake in each of Donbasenergo PJSC and DTEK Donetskoblenergo PJSC, a 46%stake in Cherkasyoblenergo PJSC and a 16.537% stake in Mine named afterZasiadko PJSC.

The sale of all power facilities within the twocategories above as well as of Odesa Port Plant PJSC will be held onlyfollowing a decision of the Cabinet of Ministers of Ukraine approving the termsof their sale.

The sale of category (3) companies, which includesCenterenergo PJSC (a 10% stake to be sold at a stock exchange and a 68.29%stake – through a tender with open price offers), Mykolaivska CHP PJSC (a 5%stake at a stock exchange and a 95% stake - through a tender with open priceoffers), Central Processing Plant Vuglegirska Private Joint Stock Company (a41% stake to be sold at a stock exchange), DTEK Oktiabrska Central ProcessingPlant PJSC (a 38.25% stake to be sold at a stock exchange) and DTEK DobropilskaCentral Processing Plant (a 38.25% stake to be sold at a stock exchange) willbe held in September through December following approval of their privatisationby the Cabinet of Ministers of Ukraine and/or transfer of their stock to theFund.

*Group C (in Ukrainian – група В) includesintegrated property complexes of the companies which, during a fiscal year,employ more than 100 employees and have a gross profit exceeding UAH70 mln.and/or value of assets sufficient to establish a joint stock company(currently, approx. USD 70,388), and shares in joint stock companies formed inthe course of privatisation and corporatisation;
Group D (in Ukrainian – група Г) includes integrated property complexes andshareholdings in joint stock companies which have strategic importance forUkraine’s economy and security and those which have dominant market positions.

Authors:

Graham Conlon, Partner, Graham.Conlon@cms-cmck.com

Tetyana Dovgan, Senior Associate, Tetyana.Dovgan@cms-cmck.com