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Today's paper. Last Updated: 06/02/2012

Chubais Promises Sale of 63 Top Firms

In a last-ditch attempt to collect millions of unused vouchers, the Russian government announced Wednesday it would put some of its biggest and most profitable enterprises under the hammer in the last weeks of June. Anatoly Chubais, the head of the State Property Committee, which governs privatization in Russia, told a news conference that the government had signed a decree to send 63 of Russia's most profitable companies, including energy, military and chemical companies, to the auction block before the voucher program expires July 1. "We will sell an unprecedented amount of property within the last three weeks of June." Chubais said the government had collected about 126 million of the 148 million vouchers it issued to each Russian citizen in 1992, leaving about 22 million outstanding with just three weeks to go before voucher privatization ends. "We have been seriously worried about whether we would manage to collect all the vouchers by July 1," Chubais said. Chubais called the companies to be offered "the biggest jewels in the Russian privatization crown." He said the state, beginning Thursday, would sell off companies with total start-up capital of 93 billion rubles ($47 million) at auctions throughout Russia. This compares with total sales of 45 billion worth of state property since the beginning of 1994. The 63 companies include enterprises like the large oil conglomerate Nizhnevartovskneftegaz, the country's largest chemical producer, Apatit and the Nizhny Novgorod submarine producer Krasnoye Sormovo. The measure also orders the sale of shares in the Norilsk Nickel Factory, one of the world's largest producers of the metal, and extends the sale of Gazprom, the state natural gas concern, to June 30. The government had announced the auction of some of these companies in March but they were not sold off for reasons that Chubais did not explain. He nevertheless said that their privatization marked a final triumph for his controversial plan to denationalize the massive Soviet state economy. "The big Russian fight for privatization is over with a complete victory of privatization," Chubais said. "This will give every Russian citizen a chance to realize his right for part of the state property." Chubais on Wednesday also declared victory over his privatization rival, Moscow Mayor Yury Luzhkov. Luzhkov, who had canceled privatization in the capital in April, announced this week that he had withdrawn the regulation. "The rescinding of the regulation means Luzhkov had the personal courage to acknowledge the illegality of his own regulation," Chubais said. "It deserves respect." As a sign of his victory, Chubais announced that the Moscow Oil Refinery will hit the auction block June 16-30. The firm will offer 34 percent of its charter capital of 807 million rubles to the public. The new government initiative comes after the voucher crashed last month to a low of 19,000 rubles amid rumors of the possible firing of reformist political leaders and plans to regulate the sale of shares of Gazprom. The voucher continued its recovery Wednesday, nearing 30,000 rubles per voucher. Among the companies to be auctioned under the decree is Nizhnevartovskneftegaz, one of Russia's biggest oil companies with a charter capital over 18 billion rubles. The company will offer 22.4 percent of shares to the public beginning June 16. Another oil company, Megionneftegaz, with charter capital in excess of 6 billion rubles, will offer 18.25 percent of its shares to the public. Krasnoye Sormovo, a former secret military enterprise, with about 1.5 billion rubles of charter capital, will offer 24.5 percent of its shares to investors beginning June 13. Apatit, one of Russia's major chemical exporters, will hit the auction block June 13. The firm has over 2 billion rubles in charter capital and 30 percent of the stock for the public auction. The government also decided to sell an additional 3.6 percent of the stock of energy giant All-Russian Energy System beginning June 16, Chubais announced.




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