* Rosneft stake sale unlikely before 2016 - Vedomosti
* Report says new plan to be discussed on June 27
MOSCOW, June 17 Russia plans to delay its
privatisation programme and hold on to stakes in state companies
such as Rosneft for longer, a report said on Monday,
compounding disappointment for investors who have been pulling
money from the country.
In 2010 Russia announced plans to raise $50 billion in five
years from reducing its stakes in the likes of oil major Rosneft
and the country's two biggest banks, Sberbank
Russia has completed only a handful of privatisations so far
and observers are not surprised that a new timetable is in the
"It's a little negative - you hear one thing and suddenly it
changes," one trader said.
The Vedomosti business daily reported on Monday that a new
plan would be reviewed by the government next week and that the
sale of 19.5 percent of Rosneft is unlikely to be
completed before 2016, entrenching state control over the medium
"The original plans were always seen as overly ambitious and
not likely to materialise in terms of the timing," said Alexey
Zabotkin, head of investment strategy at VTB.
The new schedule "establishes a more realistic baseline," he
said, adding that the last thing the government wants is to
overwhelm the stock market with relentless supply of Russian
The go-slow on state sell-offs would mark a victory for Igor
Sechin, the Rosneft CEO and ally of President Vladimir Putin,
and a setback for Prime Minister Dmitry Medvedev's market reform
agenda as Russia prepares to host a major investment forum.
International CEOs and officials flying in for this week's
St Petersburg International Economic Forum will be seeking
reassurance that Putin is standing by his statement a year ago
that "state capitalism is not our goal".
Slow progress on reforms has contributed to investor
exhaustion with Russia and more than $1.5 billion has been
pulled out of Russia-focused funds this year, according to
The delay may also deal a blow to the federal budget. The
Economy Ministry had expected the Rosneft sale to contribute to
the planned 420 billion roubles ($13.28 billion) in
privatisation proceeds this year.
In March, however, the state property management agency
Rosimushchestvo announced that those proceeds would bring only
60 billion roubles, forcing the finance ministry to seek other
sources of revenue to keep a lid on the country's budget
Vedomosti, citing a document prepared by Rosimushchestvo,
said that privatisation of other natural resources companies and
banks could be revised.
The new plan, to be discussed by the government on June 27,
proposes that the state keeps a controlling stake in VTB beyond
2016, the paper said. Initial plans had called for the disposal
of the government's entire holding by that year.
Russia has carried out two large privatisation deals in the
past year or so, selling a 7.6 percent stake in Sberbank
and 50.1 percent of United Grain Company (UGC).
But those deals were dwarfed by the de facto nationalisation
of Anglo-Russian oil venture TNK-BP, bought in March by Rosneft
in a $55 billion cash-and-stock deal through which BP
raised its stake in Rosneft to 20 percent.
The plan also includes telecoms company Rostelecom
, which the state wants to exit by 2016, Vedomosti
said. The Federal Property Agency declined comment.