RAO UES to dispose of CIS assets

Oct 04, 2006 02:00 AM

RAO UES of Russia has set to preparing the sale of 60 % in Inter RAO UES that controls CIS energy assets of the holding.
The procedures of the deal will be elaborated till late October and no potential buyer for $ 780-mm stake has been picked out yet. But the analysts are absolutely sure the government will regain control over Inter RAO in any case.

RAO UES of Russia is willing to dispose of 60 % in Inter RAO UES, said a high-rank source in the company, specifying the deal could be accomplished before late this year. The selling intention of Russia's energy holding has been confirmed by bureaucrats of profile ministries and by market players.
In the recent years, Inter RAO has been aggressively buying the energy assets in CIS. According to the Bank of Moscow, the current worth of the company equals $ 1.3 bn, so 60 % in it could cost about $ 780 mm.

One of Gazprom’s divisions will probably become a new co-owner of Inter RAO, the analysts speculate. The acquisition would help avoid clashes between the gas monopoly and Inter RAO on energy markets of CIS.
The sale of the stake is tied to “the winter peaks of loading and deliveries of Ukrainian electric energy to the RF,” said the source with the company. The energy will be shipped in exchange for the gas supplied by RosUkrEnergo (RUE; 50:50 owned by Gazprombank and Ukrainian businessman Dmitry Firtash). Of interest is that a source with Ukrainian cabinet forecasted that the buyer will be RUE or other firms of Firtash.

The state-run Rosenergoatom that currently holds 40 % in Inter RAO could be a potential buyer as well.
But no matter what official new co-owner the company gets in the end, it is likely to remain under control of the government and BOD Chairman Andrey Rappoport, the analysts are sure.

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