Questionable timing of a little bit of privatisation – Back to Odessa Port Side (& others)

A couple of months ago, this entry appeared relating to the possible privatisation of Odessa Port Side, alleged and disputed debts to Dmitry Firtash’s RGK Trading of $1.39 billion, and the fact that gas was now being supplied by German energy company E.on.  It went on to question the ability to privatise Odessa Port Side with this issue outstanding, despite a clear need for the State to privatise assets and get them off of the governmental books.

On Wednesday 17th December, an official report appeared in the Vidomosti Pryvatyzatsii newspaper announcing several partial privatisations by the government.

Quite why they are partial privatisations rather than full – or even majority share – privatisations is something to ponder.  Perhaps the inability to shake the entrenched paternalistic “State involvement in everything” mentality that consistently weighs Ukraine down, leaving it mired in a quasi-Soviet economic system it cannot escape whilst such a mentality continues, or other perhaps perceived “strategic” reasons will be cited for partial privatisation, can be argued another day.  Maybe nobody would buy shares in such enterprises without the government holding the majority of shares and thus acting in effect as a de facto guarantor for investment after the Cabinet of Ministers, via Resolution 1186, instructed Oschadbank to loan UAH 5 billion to Odessa Port Side for gas payment.

Regardless, according to Vidomosti Pryvatyzatsii, on 24th December, a stake of 5% of Odessa Port Side will be up for sale on the Perspectiva Stock Exchange.  The 5% share sale expected to realise UAH 39.927 million.    The controlling stake to apparently be sold at sometime in 2015 – presumably once the issues with Mr Firtash and RGK Trading have been settled.

Nobody would be surprised to see that dispute disappear should Mr Firtash mysteriously/coincidentally acquire the controlling stake in Odessa Port Side of course.

As an aside, the Vidomosti Pryvatyzatsii newspaper also announced the sale of 10% of shares in the currently entirely State owned Centerenergo – the share price UAH 6.973, expecting to raise UAH 257.6 million.  This sale occurring through the Ukrainian Interbank Exchange, also on 24th December.

Also for sale on the Ukrainian Interbank Exchange on 30th December, will be 25% of shares in Dniproenergo, expecting to raise UAH 1.23 billion.

The last partial privatisation mentioned in the article is the 25th December offering of 25% of shares in Donbasenergo on the Eastern-Europe Stock Exchange, with the 25% being valued at UAH 282 million.

It would appear from the timing, 24th, 25th and 30th December, that these offerings may not be particularly aimed at attracting the rather merry/tipsy/drunk western-European investors mercilessly imbibing large quantities of sherry/port/whatever, at the epicentre of the festive period, as prescribed by the Gregorian religious calendar.

Indeed the timing would seem to invite some last moment Christmas shopping for the Orthodoxy oligarchy, and followers of the Julian calendar, for whom 24th, 25th and 30th December are just another working day.  Naturally, should the undesirable/dubious personalities or their entities purchase the shares, Ukrainian public ire is also likely to be dulled by the festive season/holidays commencing on 31st December – the day after the last share sale.

In politics, like comedy – timing is everything.