Investment consultants actively pushing idea of privatization through convertible bonds - Shuvalov
MOSCOW. June 7. (Interfax) - Consultants to the Russian government for the privatization of major state-owned assets are actively pushing the idea that the government make sales using the convertible bonds mechanism, First Deputy Prime Minister Igor Shuvalov said.
"We have never applied, for example, convertible bonds. Here is how it works: you get money now, you give certain guarantees to the investor, but you maybe later risk only because you need to provide some compensation. But the money you received, you use it. We are working with the largest investment banks, and they are vigorously promoting this idea," he said at a Thursday briefing.
Many countries employ such a mechanism. "I can't say whether all governments are prepared to support this idea, but we are looking at how this happens in other countries," Shuvalov said.
If the opportunity emerges to utilize such an instrument or any other that allows one to take money from the market today under additional investor guarantees, then the Russian government will have more possibilities to sell state-owned assets, he said.