Ulyukayev said about the formal admission of “Rosneft” to privatization of “Bashneft”

Rosneft formally admitted to the privatization of Bashneft, said on Friday at the Eastern economic forum the Minister of economic development Alexei Ulyukayev (quoted by “Interfax”).

“In the legal sense now “Rosneft” is allowed (to participate in the privatization of “Bashneft”),” — said Ulyukayev.

He explained that the law on privatization is the norm “that in the event that the transaction is in the interests of development of the stock market are not subject to the requirement that the company, which has 25% or more (state-ownership), were not allowed”. “Technically, under this provision, as well as from the fact that technically, she directly (“Rosneft”) is not a state, but through a “layer”, that is “Rosneftegaz”, — formally, it is allowed”, — said the head of Ministry of economic development.

The privatization act expressly prohibits companies with state share over 25%, to participate in buying state assets. However, the state controls 69.5% of “Rosneft” not directly, but through “Rosneftegaz”. CEO of Rosneft Igor Sechin told “Vedomosti” that to prohibit the participation of “Rosneft” the government should issue a special Directive.

“Rosneft” and eight other companies, including LUKOIL, the Russian direct investment Fund and Independent oil and gas company controlled by the former President “Rosneft” Edward Khudainatov, in July filed applications for participation in the privatization of 50.08% of “Bashneft”. E&Y estimated the government’s stake in 306 billion rubles ($4.7 billion).

Against the participation of “Rosneft” in privatization made Deputy Prime Minister Arkady Dvorkovich and presidential aide Andrei Belousov. The representative Dvorkovich Aliya Samigulina, commenting on the RBC position of Deputy Prime Minister, said that the issue is not in his discontent, but in the direct instruction of the President to prevent state-owned companies for privatization. Belousov, who also heads the Board of Directors of Rosneft, called “nonsense” the privatization of state-owned companies to one another.

In mid-August, Prime Minister Dmitry Medvedev has postponed the privatization of “Bashneft”, is scheduled for September—October, for an indefinite period.

Even so, Sechin has been trying to get this asset, according to sources of Bloomberg, at the end of August. He suggested the government to sell the company to Rosneft at a premium to market for $5 billion, the press Secretary of President Vladimir Putin, Dmitry Peskov, told RBC that the President “has not taken any decision in this regard”.

On Friday in an interview with Bloomberg Putin for the first time commented on the possible Rosneft participation in this privatization. He recalled that “Rosneft”, “strictly speaking, is not a government company because of 19.75% of the company belongs to the British BP. “However, keeping in mind that the control packet is from the state, it’s probably still not the best option when one company controlled by the state, acquires another, purely state-owned company”, he said.

But in the end a result for the budget is important, who will give more money for trades that need to be done in the course of the privatization process,” — said the Russian President. In this sense, government cannot “discriminate against market participants, any of them,” he said.