Ukraine billionaire seeks 50 pct in RosUkrEnergo

18:04, 27 March 2008
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Ukraine and Russia agreed this month to cut out gas middlemen

Ukrainian billionaire Ihor Kolomoisky wants to buy a 50 percent stake in RosUkrEnergo, a gas intermediary under the spotlight in an energy row between Russia and Ukraine, he told a leading Internet site on Thursday, according to Reuters.

RosUkrEnergo is half-owned by Russia`s Gazprom and half by two Ukrainian shareholders, Dmytro Firtash and Ivan Fursin. Kolomoysky wants to buy both out.

It was formed in 2006 after a price row between Moscow and Kiev led to a gas cut that briefly affected Europe. But many Ukrainian politicians, including Prime Minister Yulia Tymoshenko, said it masked corruption in the gas sector.

Ukraine and Russia agreed this month to cut out gas middlemen, but Kiev officials say Gazprom still wants to keep RosUkrEnergo. A contract for 2008 supplies is yet to be signed. "I started talks to acquire 50 percent of RosUkrEnergo and decided to carry out due diligence of the company," Kolomoisky told Ukrainska Pravda, a prominent and reliable Web site.

"If what the press says is confirmed, I believe 50 percent of the company is worth no less than $2-3 billion, though it may turn out tomorrow that someone is willing to pay $5 billion."

Kolomoisky jointly owns one of Ukraine`s largest holding firms, Privat, and is a key shareholder in Russian steel maker Evraz (HK1q.L: Quote, Profile, Research), part-owned by billionaire Roman Abramovich.

RosUkrEnergo was created to transport Central Asian gas through Russia to Ukraine`s border and reduce prices, though these have risen steeply since 2005.

Tymoshenko wants a direct contract with Gazprom this year, giving the Russian giant the right to supply directly to Ukrainian industry 7.5 billion cubic metres (bcm). Ukraine imports from Russia 55 bcm a year, 75 percent of its needs.

It now pays $179.50 per 1,000 cubic metres from $130 last year and just $50 in 2005.

"What is good for the nation is the price of gas. If the system appears to be opaque, if you don`t like Mr Firtash, this is no reason to destroy the system," Kolomoisky said, referring to Tymoshenko. "You simply need to make it transparent."

Analysts at Renaissance Capital wrote in a research note that Kolomoisky and his Privat group have traditionally been supporters of Tymoshenko and her bloc.

"Kolomoysky`s announcement may well lead to accusations from the opposition that Tymoshenko is less interested in eliminating corrupt intermediaries than in transferring natural rent from her political opponents to her allies," Renaissance Capital said.

"We would require further detail before subscribing to that view."

Reuters

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