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As part of the privatization of the Russian Federation can sell 10,9% of shares of ALROSA - Siluanov - EastRussia | Far East

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As part of the privatization of the Russian Federation can sell 10,9% of the shares of "ALROSA" - Siluanov

Sale of 10,9% of shares of ALROSA during the privatization is currently being discussed by the government of the Russian Federation

As part of the privatization of the Russian Federation can sell 10,9% of shares
This was announced to journalists by the Minister of Finance Anton Siluanov.

In the Russian Federation in the face of the Federal Property Management Agency 43,9% ALROSA, Yakutia owns 25% plus one share and does not consider privatization of its stake. Another 8% of shares belong to the Yakut ulus (municipal districts), their alienation is impossible in accordance with the legislation of the republic.

The maximum size of the federal package in ALROSA, which can be sold, while maintaining the aggregate control of the Russian Federation and Yakutia, is 18,9%. It was the share within 18,9% that was mentioned in the letter of Olga Dergunova to Dmitry Medvedev, in which the head of the Federal Property Management Agency asked the prime minister to order to launch as soon as possible expert discussion on the privatization of a number of assets, including ALROSA, Interfax notes.

However, as Deputy Finance Minister Alexei Moiseyev told reporters last week, the authorities are not going to reduce the share to control. “We proceed from a small amount of privatization of ALROSA, so that in any case the government together with Yakutia will have significantly more control stock in the company,” he said, without specifying the size of the package.

From the words of A. Siluanov it follows that, after the planned privatization, Russia and Yakutia will have 8% of ALROSA shares in excess of control.

“We talked about the possibility of selling part of the 10,9% package in order to maintain control over this company by the state, including the subject of the Russian Federation,” the minister told reporters on the sidelines of the financial summit G20.
"We believe that privatization will not take place at the current valuation when the company is worth only 4x for M2M P / E," BCS analysts believe.

The privatization of ALROSA is “akin to the sale of a cash cow,” said Deputy Prime Minister and Plenipotentiary of the President in the Far Eastern Federal District Yury Trutnev, who oversees ALROSA, in late February. In his opinion, an increase in dividend payments may become an alternative to the privatization of a part of the state-owned stake: the state will earn as much over a short period as from a potential sale, while remaining the owner of the shares. “Over the course of a couple of years, we will receive the same money,” said the Deputy Prime Minister. Y. Trutnev noted that he does not see the diamond mining company in the top list of sales.

The ALROSA IPO was held on the Moscow Stock Exchange in the autumn of 2013. Then the Russian Federation and Yakutia sold at 7%, another 2% was implemented by the structure of the diamond mining company itself. The deal was organized by VTB Capital, Renaissance Capital, Goldman Sachs, JP Morgan and Morgan Stanley, the shares were placed at 35 rubles, the whole company was valued at 258 billion rubles. Now the capitalization of ALROSA is about 514 billion rubles.