* IPOs, debt issues, conferences already postponed due to
* Privatisation program has been much-delayed
* Russian officials concerned about economic impact
By Maria Kiselyova and Megan Davies
MOSCOW, March 18 Russia said its long-delayed
privatisation programme could be postponed again, the latest
victim of a deepening economic crisis over Ukraine that has put
off IPOs, debt issues and conferences.
Russia's MICEX index, already hurt by an economic
downturn, has fallen 13 percent this year, while the rouble is
down 11 percent against the dollar on concerns about the
impact of deteriorating relations with the West.
The escalating worries over Ukraine have caused deals to be
put on ice as bankers and investors weigh the potential costs of
tougher sanctions from the West.
Olga Dergunova, head of the state property management
agency, said on Tuesday that Russia's government could postpone
major privatisation deals expected in the second quarter if the
Ukrainian crisis took a heavy toll on the economy.
"It may obviously (happen), we could do it in the third and
in the fourth quarter," Interfax news agency quoted her saying.
She mentioned airline Aeroflot, shipping group
Sovcomflot and oil major Rosneft as candidates for
privatisation deals this year.
Telecoms groups Rostelecom is also on the
privatisation list although Kommersant newspaper on Tuesday
reported that it was delaying its planned secondary public
offering, scheduled for the first half of the year, due to
turbulent markets. Rostelecom declined to comment.
Other equity offerings have been put on ice as companies
wait for the situation to improve, banking sources and sources
familiar with the deals have said. Several IPOs are in the wings
including German retailer Metro's 's Russian wholesale
business, children's goods retailer Detsky Mir, and credit
company Credit Bank of Moscow.
Bond deals put on hold include Russian bank Promsvyazbank
which said it was delaying a roadshow to investors.
Credit firm TCS said it would only consider a Eurobond
issue once conditions were favourable again.
As international investor sentiment towards Russia took a
hit, conferences have also been put on hold.
Russia's largest bank Sberbank postponed one of
the country's highest profile investment conferences while VTB
Capital, the investment banking arm of Russia's second-largest
bank VTB, postponed an investment forum.
Depositors have also been betting on the rouble's decline
and moving money, bankers said. One banker at a Russian retail
bank, who declined to be named, said there had been evidence of
customers changing money from roubles into dollars and euros.
Putin on Tuesday fiercely defended Russia's actions in
Crimea and blasted the West, but markets took some cheer from
comments that pacified concerns Russia would try to seize other
"We still need to see how or if ... the world reacts to a
formal assimilation into Russia," said one emerging markets
banker. "But (there) seems to be a little more optimism around."
Putin's decision to raise the stakes in Ukraine has caused
concerns of lasting damage to Russia's economy.
"The economic situation shows clear signs of a crisis,"
Deputy Economy Minister Sergei Belyakov told a local business
conference in the first acknowledgment by a Russian official of
an economic crisis.
Russia's Deputy Minister of Industry and Trade Alexey
Rakhmanov said any action in terms of sanctions would be
reciprocal and that Russian industry could survive, but conceded
the risk to the country.
"We are serious in attracting so many foreign investments to
Russia and to spoil it at one moment would be a silly exercise,
but it is a two way road," he said on the sidelines of an Adam
Smith autos conference in Moscow.
Rakhmanov said Russia has worked hard to build
self-sustainable businesses in every industry and "we feel ...
reasonably comfortable that we can survive on our own.
"On the other hand, I like to express the hope that
commonsense will prevail and the long-standing economic benefits
will lead all the decision making," he said.