By Shumita Sharma Deveshwar of Trusted Sources
The Indian government’s sale of a 5 per cent stake in the Steel Authority of India Ltd (SAIL) was meant to serve as a gauge of investor sentiment towards public sector stocks before the bigger sell-offs of shares in Coal India and the ONGC oil & gas group. But it has left some doubts about the potential success of the record disinvestment programme and the consequent reduction of the fiscal deficit. Read more
Even inside the labyrinthine central circle of Algeria’s governing regime, the magnitude of last month’s failure to auction off shares in the country’s energy reserves has not been lost.
While the officials that head the Agence Nationale pour la Valorisation des Ressources en Hydrocarbures (Alnaft) frantically try to determine why just four of the 31 oil and natural gas concessions the country offered to international energy companies this year were taken, former state energy executives are openly expressing their dismay. Read more
By Timi Soleye of CRYO Gas
Seated on the dais at an investment conference in one of Lagos’s posher hotels are the luminaries of the Nigerian power sector: the minister of power, the head of the national electricity regulator, the chairman of the presidential task-force on power and chief executives of the newly privatised electricity generation companies and distribution companies. They are desperate for the money of the reluctant foreign private equity managers and local investors who mill about the room.
It is a tough call. On November 1 a year will have passed since the effective privatisation of electricity generation and distribution in Nigeria and it must now be acknowledged that the privatisation is on the brink of collapse. Yet this is a good thing for Nigerians and for future investors. Read more
It looks like the Belarusian authorities are becoming serious about re-starting their state property privatisation programme, announced in October. On Friday, the government revealed that it has offered a stake in Mozyr refinery, one of the country’s most profitable enterprises, to Russia’s oil giant Rosneft. A few days earlier, the government said it has plans to sell a stake in state-controlled MZKT, known globally as a producer of military vehicles as well as chassis for Russian strategic missiles. Read more
Initial public offerings, especially those tied to privatisations by Poland’s treasury ministry, have the reputation for being money spinners, but there is no such thing as a risk-free investment, as punters are learning on Wednesday on the Warsaw Stock Exchange. The shares in Energa, the country’s third largest power distributor, sagged in the first hours of trading.
Energa launched on the WSE in a privatisation worth 2.4bn zlotys ($787m), the bourse’s largest IPO in two years. Read more
At first glance the announcement in Turkey’s Official Gazette on Tuesday that Turkey’s State Supply Office has issued a tender to buy 250m instant win lottery tickets might look like a cunning plan to help cover Turkey’s burgeoning current account deficit.
A second glance might conclude that the unusual tender is related to the privatisation on behalf of Turkey’s national lottery, Milli Piyango. Read more
By Pavel Morozov of State Solutions
Russia’s heavily trailed privatisation programme, the scale of which has not been seen since the controversial loans-for-shares privatisations of the 1990s, has so far not delivered on expectations. Assets worth $13bn were set to be sold in this year alone, but now it looks like the Federal Treasury will be receiving $1bn at most. And according to treasury figures, just 4 per cent of privatisations planned for the first half of 2013 were implemented, with only $500m in assets sold.
Officials have blamed recent global market conditions. But the reality is more complex. Read more
Poland’s new treasury minister is casting doubt on the model of pressing cash-rich state controlled companies to get involved in areas distant from their own expertise – the best example being the participation of KGHM, the copper miner, in a consortium financing the hunt for shale gas.
In his first interview with the foreign press, Wlodzimierz Karpinski, who took the post six months ago, distanced himself from the idea. Read more
It was the biggest initial public offering in Romania’s history, and the latest of several big IPOs in eastern Europe. But will Friday’s part-privatisation of natural-gas utility Romgaz reinvigorate Romania’s stalled liberalisation programme? Read more
Just days before Serbia unveils its rebranded flag carrier in partnership with the UAE’s Etihad, Croatia has announced that it is seeking a strategic investor with ambitious plans for its own national airline. Where national carriers seemed to be dying off, killed by competition from budget carriers and western European rivals, there is now real hope of revival. Read more
Sechin: he seems friendly
The cash-strapped government of Belarus is preparing to re-start its privatisation programme, stalled since last year. It plans to sell stakes in a few dozen state-owned companies and Mozyr refinery, one of two in the country, is the jewel in the crown.
It seems that Russia’s Rosneft, which already partly controls Mozyr with Gazpromneft, the oil arm of Russian state gas giant Gazprom, is among the biggest potential bidders. Read more
A long-running Czech corruption scandal has ground to a conclusion in Switzerland, with a Swiss court convicting five Czechs and one Belgian for their role in the privatisation of a Czech coal company in the late 1990s.
The Swiss had accused them of money laundering and fraud in a scheme to gain control of Mostecka Uhelna Spolecnost (MUS), now part of Czech Coal, that saw the state-controlled company bought by its managers, financed by the company’s own assets. Read more
By Jean-Marc Peterschmitt of the EBRD
Slovenia is facing its most serious economic crisis since it joined the European Union in 2004 – a crisis that has shattered previous convictions and conventions about how the country ran its economy. This is welcome. Even more welcome is the determination of the current government to implement decisive measures that aim to put the country on a path of sustainable and stable growth. Read more
To nobody’s great surprise, Russia on Thursday revealed that it was cutting in half its target for privatisation revenues for 2014-16.
The government blamed the financial markets. But the truth is that Russian assets are hard to sell at the best of times. The country needs the economic reforms that president Vladimir Putin has often spoken about, including at the recent St Petersburg Economic Forum, but has so far largely failed to deliver. Read more
So, Mexico will indeed enact constitutional reform to open its oil industry to the private sector. That is what Enrique Peña Nieto, the country’s president, told FT journalists during a visit to the newspaper on Monday.
“There are different options on what the reform should be, but I am confident… It will be transcendental,” he said, adding that the reform would include “the constitutional changes needed to give private investors certainty”.
This may be news to many readers in Mexico. Read more
Question: What’s the link between a national airline, a global-brand ski factory and an organic flour producer?
Answer: none at all, except in Slovenia, where any half-aware citizen would immediately recognise them as state-owned companies being prepared for privatisation to raise the cash to bail out Slovenia’s heavily indebted banks and balance the national budget. Read more
Kosovo’s government has hailed the sale of the territory’s most profitable enterprise as a breakthrough for investment. And as if to vindicate the optimists in Pristina, the sale of a 75 per cent stake in state telecom company PTK was followed days later by a landmark deal with Serbia that gives the Kosovan government control over the whole territory and opens the door to a deepening of relations with the EU.
But it remains to be seen whether the controversial sell-off will pave the way for lasting success. Read more
Slowly but surely, Romania is limbering up for its next sell-off of state-owned companies. Under IMF duress, the country may be about to shed some of its weighty burden of strategically important but failing enterprises.
On Friday, Reuters reported that Romania was launching the sale of a majority stake in CFR Marfa, the country’s rail freight operator. The starting price was set at 797.1m leu ($234m). Read more
By Jake Maxwell Watts and Nguyen Phuong Linh
Vietnam’s prime minister, Nguyen Tan Dung, is arguably a better Communist than he is a match-maker, judging by a recent spate of enforced bank mergers. The latest, between Western Bank and PetroVietnam Finance Corp, the finance arm of state-owned oil and gas giant PetroVietnam, was confirmed by the former and denied by the latter. Judging by an announcement on the central bank’s website, it looks likely to go ahead anyway. Read more
By Luka Orešković of Provectus Capital
Last week, political change captured the global headlines. Pope Francis took over leadership of 1.2bn Catholics, matched by Xi Jinping, with his official ascendance to the presidency over 1.3bn in the People’s Republic of China. In between Beijing and the Vatican, and somewhat less noticed, the 2m people of Slovenia were also facing a change in government, with the center-right premier Janez Janša set to be replaced by Alenka Bratušek, the center-left head of Positive Slovenia.
With the European Commission forecasting an economic contraction of 2 per cent this year, and increasing talk of a bailout, the new government will face a challenging 12 months. Read more