Breaking News

Ukraine president agrees chemical plant sale -aide

Jul 16, 2009 08:48AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items

KIEV, July 16 (Reuters) - Ukrainian President Viktor Yushchenko has agreed to the privatisation of one of the country's largest companies, a senior adviser said on Thursday, after banning its sale three times over the past two years.

The government has been trying to sell the Odessa Port chemical plant for years and on Wednesday set a minimum price of 4 billion hryvnias ($525 million) for an auction on Sept. 29. It hopes to earn up to $1 billion.

Yushchenko, in a power struggle with Prime Minister Yulia Tymoshenko for 18 months, last banned the sale in May 2008 on the grounds that the plant was a strategic asset, giving the buyer exclusive access to a key pipeline and port terminal.

"We talked to the government and we agreed that the Odessa Port plant will be ... privatised," Oleksander Shlapak, the president's chief economic advisor, told reporters.

"The new owner of the plant cannot receive a monopolistic right to decide to whom he would give access to the pipeline to the terminal and to whom not," he said. "This will remain under government regulation."

Shlapak said Yushchenko agreed to the sale also because the plant started to make losses this year, mainly due to a sharp rise in the price of Russian gas, which it needs to produce chemicals -- mostly fertilisers.

The government's stretched finances would benefit from any new funds. Export and tax revenues have declined sharply as the country faces a deep recession and billions need to be spent to shore up the banking and energy sector.

The government has set conditions for the sale including guarantees that the plant becomes profitable and investments of 1.3 billion hryvnias ($170 million) in the first five years.

The new owner would also be obliged to increase revenues from the chemical plant to 3.02 billion hryvnias by the fifth year of ownership from 2.34 billion hryvnias in the first year.

The plant had revenues of 3.6 billion hryvnias and profits of 800 million hryvnias last year, against revenues of 2.3 billion hryvnias and profits of 310 million hryvnias in 2007. (Reporting by Yuri Kulikov; writing by Sabina Zawadzki; editing by Simon Jessop)

Ukraine president agrees chemical plant sale -aide

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Are you sure you want to delete this chart?
Write your thoughts here
Replace the attached chart with a new chart ?
Post also to:
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Post 1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email