Appointment of Tymoshenko is positive signal for energy sector

16:45, 18 December 2007
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Though risk of Luhanskteplovoz resell increases – G&T

Today the Verkhovna Rada appointed Yulia Tymoshenko to the position of Prime Minister by 226 votes out of 226 required. The Party of Regions officially declared itself as an opposition.

According to a press-release, forwarded to UNIAN from G&T, this appointment will bring more certainty to the market as Ukraine gets the new government. The Ukrainian Constitution guarantees that the new parliament will function at least one year. “We expect the configuration of the current coalition will not change. However, the legislation process will be highly ineffective as the coalition has marginal majority in the parliament so any voting in will need rigorous preliminary negotiations even within the coalition”, the press-release reads.

G&T believe that this appointment is a good news for Privat-owned Ukrnafta (UNAF) given close ties between Yulia Tymoshenko and owners of Privat Group.

The risk of reprivatization and resell of Luhanskteplovoz (LTPL) is increasing with this appointment.

”We also think that this is a positive news for the energy sector as a whole as in the long term. Ms. Tymoshenko might  accelerate the privatization process and strive for more transparency, that should result in higher premiums and more strategic interest to the sector. We therefore reiterate our BUY for ZAEN, CEEN and DOEN”, the press-release reads.

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