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. Last Updated: 07/27/2016

Rosneft Welcomes Privatization Talk

Rosneft CEO Sergei Bogdanchikov would welcome a move by the state to sell more of its shares, he said Wednesday, after Prime Minister Vladimir Putin promised a new wave of privatizations.

Bogdanchikov said the sale needed to attract new shareholders and investors. “I am aware of such proposals. We have not discussed them but in general, in terms of increasing the free float, attracting new investors, we welcome them,” Bogdanchikov told reporters on the sidelines of VTB Capital’s investment forum.

He said Rosneft, in which the government owns 75 percent, also wanted to sell its treasury shares, representing about 9 percent of its charter capital, together with the state if the privatization was to be approved.

The company’s free float is just 15 percent and the remainder of the company’s stock is held as treasury shares, which the company bought back after raising $10.6 billion in an initial public offering in 2006.

Putin, who ultimately holds the power to decide on any state sell-offs, spoke on Tuesday in favor of further privatizations, though no specific timetable has been announced.

Bogdanchikov said Rosneft was also looking at French oil major Total’s proposals to sell its European refining business.

“We always study existing assets. As far as Total’s proposals are concerned, we are looking at them as well,” he said.

Bogdanchikov also spoke out against Hungary’s MOL, saying that Rosneft’s inability to exercise shareholder rights in the company was “unfair.”

Surgut “paid a lot of money, and the acquisition was made according to the law,” Bogdanchikov said.

“Because of the management’s opposition we don’t see the entry of our companies into the Hungarian market — and Europe.”

Surgut announced at the end of March that it had purchased a 21.2 percent stake in MOL from Austria’s OMV, which the company’s management said was a “hostile” move with a goal to take over the company.

Surgut was unable to participate at MOL’s annual general meeting in April as the Russian company lacked Hungarian regulatory approval.

(Reuters, Bloomberg)