OGK-1 Says Dubai Faces Rival Bidder

Electricity generator OGK-1 said Monday that there was a second potential buyer for a controlling stake in the company, and a previously announced deal involving Dubai World was conditional.

"There is another potential buyer. It is a consortium of Russian and foreign companies, which are now working out the structure of the deal. They have shown a very serious interest in the company," OGK-1 chief executive Vladimir Khlebnikov said.

Anatoly Chubais, who headed state-run Unified Energy System, of which OGK-1 was a part, has said Dubai World was guaranteeing $100 million of investment in OGK-1 as part of a $5.3 billion bid for the company. UES was dissolved on July 1 after the completion of a restructuring of the power industry.

The first bid for OGK-1 was made by Roskommunenergo, a Russian company chaired by the son of a Kremlin official that operates municipal utilities, and Khlebnikov said Dubai World's role in financing the bid was unclear.

"It is not clear who is the main company financing Roskommunenergo's offer ... but it is hardly possible that Roskommunenergo can be the main financier," he said.

Khlebnikov said Dubai World had nearly three months to firm up a deal for OGK-1.

"The Dubai fund in its preliminary agreement said it is ready to conduct very serious due diligence. This will take about two months," Khlebnikov said.

"They have until Oct 1 to structure the deal or it will be annulled. The preliminary agreement is not unconditional, but conditional."