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Gazprom Drops Coal Expansion Plans
Russia’s gas monopoly Gazprom and Siberian Coal Energy Company (SUEK) have abandoned the idea to consolidate energy assets worth $16 billion. The parties failed to compromise on control over the venture and the situation further aggravated once SUEK appointed some managers without agreeing on their candidacies with Gazprom. The last straw, perhaps, was the recommendation of President Dmitry Medvedev, who made clear that the deal could be perceived as another expansion of the government to power engineering.
According to the sources, Gazprom addressed the Federal Antimonopoly Service June 6 with the request to call back its application for the buyout of 50 percent plus a stock in SUEK. People in Gazprom and SUEK didn’t comment on the decision yesterday, and the antimonopoly authority refused to elaborate till the deal’s cancellation was officially announced.
The sources give three basic reasons of the failure to create Russia’s biggest energy holding via the deal of the estimated worth of $16 billion. The first one is the opposition of the Federal Antimonopoly Service and the second is the parties’ inability to agree on managing the venture during a year and a half of negotiations. Regardless, the decisive reason could be the change in opinion of Russia’s President Dmitry Medvedev.
Medvedev had welcomed the deal when holding the offices of Russia’s first vice premier and Gazprom BOD chairman. Today’s idea, however, is not to irritate the market by openly grabbing under the government’s control a sizeable portion of energy assets straight after the reform of the electric power industry in the country.
www.kommersant.com
All the Article in Russian as of June 09, 2008
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