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Russia mulls 19 percent Rosneft stake sale in 2013: economy minister
April 11, 2013 / 12:05 PM / in 5 years

Russia mulls 19 percent Rosneft stake sale in 2013: economy minister

MOSCOW (Reuters) - Russia’s government is considering selling a 19 percent stake in state-controlled oil major Rosneft (ROSN.MM) this year as part of plans to speed up privatization, Economy Minister Andrei Belousov said.

A logo of Russian state oil firm Rosneft is seen at its office in Moscow, October 18, 2012. REUTERS/Maxim Shemetov

Russia’s plan to sell stakes in large firms and banks has slipped behind schedule, but officials are showing greater urgency to complete asset sales as a slowing economy dents tax revenues.

“I raised the issue during the government meeting that we need to speed up the process of large-scale privatization,” Belousov told reporters after a cabinet meeting in Moscow.

The government has long been studying the possibility of selling a stake in Rosneft, whose market value is $77.5 billion.

The 19 percent it would look to sell comes on top of the stake already acquired by British oil major BP (BP.L), Belousov said.

BP (BP.L), which already had a small stake in Rosneft, ended up with 19.75 percent earlier this year after Rosneft’s $55 billion acquisition of Anglo-Russian crude producer TNK-BP TNBP.MM.

As part of the TNK-BP deal, BP received $17 billion cash and a 12.84 percent stake in Rosneft. BP then bought 5.66 percent of Rosneft from state energy holding company Rosneftegaz.

“It’s a strategic decision, on Rosneft,” Belousov said. “There is already 5.66 percent (sold), we are talking about an additional package.”

According to the government’s mid-term privatization strategy, the state energy holding company should start cutting its 69.5 percent stake in Rosneft this year, with a complete sale by 2016.

Rosneft’s powerful chief executive, former deputy premier Igor Sechin, has lobbied against a sale. He also chairs Rosneftegaz, enabling him to influence the government’s approach to managing its assets.

Rosneft’s shares fell 2 percent to 220.80 roubles, their lowest since the TNK-BP deal was announced in October.

Other privatizations planned this year are Aeroflot (AFLT.MM), Rostelecom (RTKM.MM), Sheremetyevo airport and United Grain Company, Belousov said.

Reporting by Darya Korsunskaya; Writing by Vladimir Soldatkin and Megan Davies; Editing by Douglas Busvine and Helen Massy-Beresford

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