Putin authorizes reduction of RF stake in Alrosa to 33%, 10.9% stake could be sold
MOSCOW. May 12 (Interfax) - The government stake in diamond miner Alrosa can be lowered to 33.001%, according to a decree that Russian President Vladimir Putin signed on May 12 and which amends the list of strategic enterprises and companies.
The Russian Federation currently owns 43.9% of Alrosa, so the decree implies that not more than 10.9% of the company will be privatized.
The government spent months discussing the size of the Alrosa stake that would be privatized. Yakutia has 25% plus one share, but privatization of that stake was not being considered. Municipal districts in Yakutia have another 8%, which cannot be divested under local law. The maximum stake in Alrosa that could be sold, leaving Russia and Yakutia with a controlling stake in the aggregate, is 18.9%. That was the option backed by Economic Development Ministry, but not by the Finance Ministry.
Finance Minister Anton Siluanov, who is the chairman of Alrosa's supervisory board, said in mid-April that the state planned to sell a 10.9% stake and sale of an 18.9% stake was not being discussed. Then, in late April, Economic Development Minister Alexei Ulyukayev said sale of an 18.9% stake in a public placement on the Moscow Exchange was a possibility.
The Economic Development Ministry proposed giving Sberbank CIB the mandate to organize the Alrosa privatization, a decision that must be approved by the government.
An IPO in Alrosa was held on the Moscow Exchange in the fall of 2013. Russia and Yakutia each sold 7% stakes and the company itself sold 2% of shares. The shares were placed at 35 rubles each, valuing the entire company at 258 billion rubles.
At the end of March, Alrosa President Andrei Zharkov said that the best privatization option would be to sell shares among a wide circle of investors.
