OREANDA-NEWS. April 14, 2011. The Cabinet of Ministers included stakes in 11 electric utilities for privatization, according to a decree which was published yesterday: 25% stake in Dniproenergo (UX: DNEN UK), 45.1% stake in Zakhidenergo (UX: ZAEN UK) and 25% stake in Kyivenergo (UX: KIEN UK). The government is planning to retain 25% stakes in all three GenCos. The list also includes stakes in eight electricity distribution companies: 50% in Vinnytsyaoblenergo (UX: VIEN UK), Dniprooblenergo (UX: DNON UK), Zakarpatoblenergo (UX: ZOEN UK), 45% in Krymenergo (UX: KREN UK) and Chernivtsioblenergo (UX: CHEN UK), 40% in Donetskoblenergo (UX: DOON UK) and 26% in Ternopiloblenergo (UX: TOEN UK).

Concorde Capital: though the decree by the Cabinet of Ministers is a necessary step in the privatization process in Ukraine, this is not binding for the government and it could take unspecified time between the Cabinet decree and auction announcements by the State Property Fund. We expect the GenCo privatizations to take place this year and a few of the Oblenergos, where there is interest by minority shareholders, though the sale of all electricity distribution companies on the list is unlikely. As the market has already heard about the government’s plans to sell off these assets for some time, we do not expect it to react to privatization related news until auctions are actually announced.