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. Last Updated: 07/27/2016

Oil Terminal Auction Fails

RIGA, Latvia -- Latvia's auction of a 5 percent stake of oil terminal Ventspils Nafta failed Friday with only one share sold, but stable first-quarter profits from the company cheered analysts.

The country's privatization agency was offering 5.2 million state-owned shares at 1.94 lats ($3.25) per share. If all the shares had been sold, the transaction could have totaled at least 10 million lats ($16.6 million).

Dealers said the stake in Ventspils, a leading handler of Russian crude and oil-product exports, could be attractive, but the starting price, fixed at a premium of 131 percent over Friday's close, was too dear.

Demand for the shares was strong in March, but tapered off after the agency announced the 1.94-lat-per-share minimum price.

"Only one share was sold. Probably somebody was trying to test the auction mechanism," a bourse official said.

Friday's auction was to be followed by an international offering of 7 percent by June 1. Officials have not said whether the results of the first auction will affect the timetable or price for the second.

Dealers said the price would have to be lowered considerably to get the two stakes sold.

Ventspils announced Friday that first-quarter net profits were 6.4 million lats, stable from 6.6 million lats in the same period last year. The company has forecast a 2000 net profit of 8.7 million lats.