SPF to Sell CentrEnergo and DonbasEnergo in June 2012

February 06, 2012

The State Property Fund of Ukraine (SPF) has scheduled privatization auctions for CentrEnergo (CEEN) and DonbasEnergo (DOEN) for June of the current year, Interfax reported on Friday, citing the SPF. The report said 53.3% of CentrEnergo and 60.8% of DonbasEnergo will be offered.

COMMENTARY

The news followed an earlier announcement by SPF Chairman Olexandr Ryabchenko that privatization of controlling stakes in these two thermal power generation companies would take place in 1H12. We view the news as POSITIVE for the CEEN and DOEN stocks. Presumably, the exact privatization terms and the actual date of these auctions will be announced in April, 75 days before the auctions, as prescribed by law. The state plans to retain blocking stakes of 25% in both companies.

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