The State Property Fund (SPF) has issued an order on the privatization of the power generating company PJSC Centrenergo.
“By order of the State Property Fund No. 1275 dated July 23, 2021, the decision was made on the privatization of a state-owned enterprise – a state-owned stake of shares in the amount of 78.289% of the charter capital of the public joint-stock company Centrenergo. These are 289,205,117 shares,” the SPF said in a statement on its website on Monday.
According to the order that approved the plan for the placement of shares, the stake of the power generating company is planned to be placed at an auction with conditions from August 2 to December 31, 2021.
The SPF’s large privatization department shall ensure the creation of an auction commission and a competitive selection of an advisor to prepare for privatization and the sale of the stake.
The auction commission for the sale of PrJSC United Mining and Chemical Company with a starting price of UAH 3.7 billion has set a date for the privatization auction, which will take place on August 31, 2021, Head of the State Property Fund (SPF) Dmytro Sennychenko has said.
“Preliminary interest in the object was expressed by a wide circle of investors, part of whom is foreign. We hope for a high competition and a market price of the sale at a transparent auction,” he wrote on Facebook.
United Mining and Chemical Company state enterprise began its actual activity in August 2014, when the government of Ukraine decided to transfer to its management the property complexes of Vilnohirsk Mining and Metallurgical Plant (Dnipropetrovsk region) and Irshansk Mining and Processing Plant (Zhytomyr region). Then it was transformed into PJSC, and then – into PrJSC.
Former head of United Mining and Chemical Company Oleksandr Hladushko has denied allegations of withdrawing funds from the company by its incumbent management.
In a comment to the Interfax-Ukraine agency he claims that there were no overdue receivables for products at the time of transfer of control to the new management in February 2020.
“For a year now, United Mining and Chemical Company has been managed by new managers. And suddenly we learn about a debt of $ 38 million for 2019, they have been modestly silent about all this time? This alogism can only be explained by the fact that on the eve of privatization, the team of Artur Somov [the incumbent head of the company] is trying to shift responsibility for their managerial mistakes onto their predecessors,” the report says.
According to Hladushko, at the time of his team’s departure from the company, it was profitable and financially secure: by the end of the first quarter of 2020, it received UAH 245 million in net profit, the balance of payments of the enterprise was positive.
“By January, the company’s accounts had over UAH 405.3 million. This was enough to keep production and supply running smoothly, pay salaries, and taxes for three to four months,” the ex-head says.
Commenting on the news about the shutdown of Vilnohirsk GOK in May 2020 and non-payment of wages to miners, and later – about production downtime due to an unstable financial support, Hladushko expressed opinion that the above funds were spent, and new ones were not earned, which led to cash breaks in the company.
The ex-head also named among the achievements of his team the growth of income of the company almost twofold – up to UAH 3.5 billion, payments to budgets almost fourfold – up to UAH 1.4 billion, investments in production by 8.3 times, up to UAH 749.6 million, as well as an increase in the value of assets by more than four times – up to UAH 3.4 billion.
Acting chairman of the board of United Mining and Chemical Company Artur Somov said earlier that the company intends to collect $ 38 million through the International Commercial Arbitration Court under contracts with the companies Bollwerk Finanzierungs- und Industriemanagement AG (Austria) and Defessa Trans F.Z.E (the UAE), through which the ex-management of United Mining and Chemical Company laundered funds from the enterprise.
Earlier, PrJSC United Mining and Chemical Company, which managed Vilnohirsk Mining and Metallurgical Plant (Dnipropetrovsk region) and Irshansk Mining and Processing Plant (Zhytomyr region), initiated the process of collecting a debt of $ 38 million, according to the company, withdrawn by the previous management.
The state enterprise United Mining and Chemical Company began its actual activity in August 2014, when the government of Ukraine decided to transfer the property complexes of Vilnohirsk and Irshansk GOKs to it. On December 8, 2016, the state enterprise was transformed into PJSC United Mining and Chemical Company, on December 26, 2018 – into PrJSC.
United Mining and Chemical Company sells its products to more than 30 countries of the world. The main sales markets are the EU, China, Turkey, as well as the United States and African countries.
In August 2016, the government included United Mining and Chemical Company in the list of companies that are subject to privatization in 2017. Its terms were postponed several times, most recently due to the coronavirus crisis and quarantine. BDO Corporate Finance as part of the consortium Baker McKenzie, Baker Tilly Ukraine and Asset Expertise, prepares the company for privatization.
The management of the SPF proposes to put United Mining and Chemical Company up for sale in the first half of this year, declares about 15 applicants for the enterprise and predicts the starting price of the object from UAH 3 billion to UAH 5 billion.
The State Property Fund (SPF) is discussing the possibility of doubling the plan of privatization receipts in 2021, to UAH 12 billion, with the lawmakers and the government of Ukraine, Head of the SPF Dmytro Sennychenko has said.
“The plan, which has now been submitted in the government budget to the Verkhovna Rada for receipts from privatization in 2021, is set at [UAH] 6 billion. We are now communicating with members of parliament, the government and clarifying the budget indicators for next year. We will propose its increase … up to [UAH] 12 billion,” he said at a press conference at Interfax-Ukraine on Tuesday.
Sennychenko said that the SPF has drawn up a list of facilities for privatization for the next year, which includes regional gas supply companies, the Bilshovyk plant and the United Mining and Chemical Company (UMCC).
He said that at the start of the “coronavirus crisis” in March 2020, the Verkhovna Rada lowered the bar for budget receipts from privatization to UAH 500 million, specifying that in 2020 the SPF exceeded it. At the moment, proceeds from privatization are UAH 2 billion, and by the end of the year they are expected to reach UAH 3 billion, the head of the fund said.
“This [the amount of proceeds] will also depend on the necessary financing steps, because one hryvnia invested in the audit of the creation of technical documentation today gives us UAH 71 of budget receipts from privatization. The most important thing is not the funds received from the sale of a facility, the most important thing is the cumulative effect that a private investor gives after investing in the subsequent development of this facility,” he said.
According to Sennychenko, this year the SPF has held more than 1,400 auctions and prepared an “investment menu” for the next year “for every taste.”
Odesa Port-Side Plant in October would announce a new tender to select a supplier of natural gas for processing on tolling terms, acting Head of the State Property Fund (SPF) of Ukraine Vitaliy Trubarov has said.
“As are as I understand, the tender will be announced again next month and maybe there are economic entities, possibly foreign ones, that could supply their own gas, and the enterprise could operate,” he told journalists in Odesa on the sidelines of the Ukrainian Financial Forum organized by the ICU investment group.
The head of the SPF said that the final decision on the tender is taken by the company management, since representatives of the SPF are members of the supervisory board and do not have the right to interfere in the economic activities of the enterprise.
Trubarov said that in the current market conditions, the attraction of the supplier of gas on tolling terms is the only opportunity of operating for Odesa Port-Side Plant, since “gas that occupies more than 90% of the production cost is quite expensive, and the prices for end products are subsiding.”
According to him, the conditions of the tender to select the company are absolutely open, and the difficulty to select it is the absence of a large number of interested companies.
He said that the SPF is extremely interested that the plant is operating at the time of the privatization work.
“Our task in this matter is to build the work in a way that at the time of sale this asset was operating, alone or with the help of a supplier of natural gas for processing on tolling terms, but operating. Selling an idle enterprise, in my opinion, is a double problem,” the SPF head said, recalling the even more complex problem of toxic debts of the Odesa Port-Side Plant to the structure of Dmytro Firtash.
The State Property Fund of Ukraine (SPF) has announced repeated tenders to select advisors for preparing the following companies for privatization: 99.9988% stake in OJSC Oriana, 99.9952% in PJSC Sumykhimprom and 100% in National Joint Stock Company Ukragroleasing. “To privatize companies for which there no tender was held, and only one bid was submitted, we announced a new tender to select advisors. Next month there will be a repeated tender,” Head of the SPF Vitaliy Trubarov told journalists in Odesa on the sidelines of the Ukrainian Financial Forum organized by the ICU investment group.
According to their terms, bids for participation in the tenders are accepted until the end of the day on October 17. The first stages of the tenders are scheduled for October 23, and the second – for October 26.
“Unfortunately, during the summer period many investment advisers could not be prepared for unbiased reasons,” Trubarov said, expressing hope that the repeated tenders will be success.
He also recalled that for the selection of an adviser for the privatization of Azovmash, the State Property Fund did not receive a single bid, and now, according to the requirements of the new law on privatization, the fund will prepare it for sale without involving an adviser.
