: :inin Kyiv (EET)

Putin advises Russian businessmen against selling Ukrainian assets


Russian President Vladimir Putin advises Russian businesses against selling their Ukrainian assets as the leadership in Ukraine may change, Russian news agency RBC reported citing one of the participants in a closed meeting between Putin and business representatives in Moscow.

”The president has made it clear that the leadership there may change, but companies and Ukraine would remain in place,” a source said, RBC wrote.
Putin recommended taking a wait-and-see approach as long as there is still hope for the normalization of relations, it said.

”He [Putin] also said that one could feel pressure in the [Ukrainian] financial and banking sector, but the situation could be different with industrial assets. But his assessment was: `One can wait to see how the developments will be unfolding,`” the source said.

Russia`s Central Bank estimated the balance of Russia`s direct investment in the Ukrainian economy at $2.17 billion as of October 1, 2015. Of the amount, $1.48 billion was equity capital, and $691 million was debt instruments.

Russian companies still own large assets in Ukraine. In particular, Russia`s Rosneft owns Lysychansk oil refinery in Ukraine`s Luhansk region and 141 filling stations. Ukrainian media reported in January 2016 that Rosneft was going to sell this chain to Swiss-based Glusco Energy, but the deal has not been concluded yet.

Another large Russian fuel producer, LUKOIL, sold its 238 Ukrainian-based filling stations in August 2014, but the company still owns Karpatnaftokhim there.

Smaller investment includes A1 investment company`s ownership of a 24% stake in Regal Petroleum, while Moscow-based Proxima Capital Group owns a 20% stake in JKX Oil & Gas with assets in Ukraine.

Oleg Deripaska`s UC Rusal owns Ukrainian-based Mykolaiv alumina works. Until 2015 the company owned Zaporizhia aluminium plant ZAlK, but, according to RBC, the asset was nationalized by the Ukrainian authorities. Igor Zyuzin`s Mechel runs partially mothballed Donetsk electrometallurgical plant; Evraz of Roman Abramovich and Alexander Abramov owns Donetsk Petrovsky metallurgical plant (steel production), Bahliykoks (metallurgical coke production), and Sukha Balka (iron ore mining).

VimpelCom, controlled by a structure of Mikhail Fridman and his partners, LetterOne, owns Ukraine`s largest mobile operator Kyivstar. The second largest mobile operator, MTS Ukraine (it now works under the Vodafone Ukraine brand), belongs to Russia`s MTS group.

Russia`s Ukrainian banking assets include Sberbank of Russia in Ukraine and Vnesheconombank`s subsidiary, Prominvestbank.

UaPositon

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