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. Last Updated: 07/27/2016

Izvestia to Privatize After Court Victory

Barely a week after Izvestia defeated a takeover attempt by the Russian parliament by winning a landmark court case, the country's most influential newspaper is going private.


The daily, one of the largest in Russia, will sell 11 percent of its shares at 1, 000 rubles each in June, Eduard Gonzalyez, a member of the board who is responsible for the privatization, said Thursday.


Gonzalyez denied that the sale was a result of the daily's recent victory over parliament in the Constitutional Court, which ruled that the parliament did not have the right to take over the newspaper.


He said Izvestia had been planning for months to privatize itself in an effort to end the year-long battle over who controls the newspaper and its publishing house.


Yet the privatization has clearly been effected by the battle with parliament.


The Russian Arbitration Court is still considering a separate claim by parliament on the newspaper's buildings, printing houses, dachas and other properties.


Because of the pending case, the privatization planned for June will sell only the "intellectual property" of Izvestia, meaning the newspaper, its supplements and the advertising agencies.


The 327 members of the workers collective of Izvestia had already acquired 51 percent of the shares in a closed auction in January, Gonzalyez said.


The 11 percent to be sold in June will be done through the voucher auction process to any individual holding the 10, 000-ruble privatization check. The remaining 38 percent would be offered to investment companies in packages of 1, 000 shares each, he said.


The starting capital of the new joint-stock enterprise Izvestia was reported at 15 million rubles ($15, 000).


Izvestia declared independence from the Soviet parliament immediately after the August 1991 coup, but in July 1992 the Russian parliament claimed ownership of the daily. When President Boris Yeltsin declared the newspaper federal property to counter parliament, the deputies voted to appropriate the whole Izvestia publishing complex. A series of lawsuits were filed last year and threats were made, but the newspaper functioned independently throughout the fight.


But Gonzalyez said the settling of the lawsuit will let the paper settle down to putting out the news.


"Now we can finally get to business and make a good newspaper", Gonzalyez said.


Izvestia publishes a weekly supplement that is jointly produced with The Financial Times of Britain. It also has a contract with the U. S. publishing giant Hearst Corp. for the publication of the We/My newspaper. Both projects are part of the property up for sale, Gonzalyez said.