OREANDA-NEWS. November 24, 2010. The State Property Fund (SPF) of Ukraine plans to announce a privatization tender to sell off its 40% stake in Severodonetskiy Azot  by 2011,  Oleksandr Ryabchenko, the SPF Chair, announced on Nov 23. The official also added that SPF had negotiated with Worldwide Chemical, the owner of the majority stake (60%), on the option of their potential acquisition of the stake.

Millennium Capital considers the news as POSITIVE for fertilizer producers. Severodonetskiy Azot is one of the major fertilizer producers in Ukraine, ranked as the third producer in term of net sales in 2008 (UAH 3.7bn). Moreover, the plant, along with Stirol and Odessa Portside Plant, is plugged into the ammonia pipeline. Millennium Capital considers the news to fit in well with the beginning of the consolidation process of the domestic fertilizer sector. We suppose that the government stake of Severodonetskiy Azot could be bought by Worldwide Chemical for further resale of the entire plant to SIBUR (with potential intermediation by Dmitriy Firtash). In 2007-2009 SIBUR had attempted to enter the Ukrainian market targeting RivneAzot, DniproAzot and Odesa Portside Plant.