EAVEX Weekly

August 21, 2017

Locally-listed Ukrainian equities were mostly lower last week as the privatizations of the state’s blocking stakes in electricity companies attracted no interest from foreign investors. Auctions for blocking 25% stakes in SumyOblEnergo (SOEN), OdessaOblEnergo (SOEN), and DonbasEnergo (DOEN) were cancelled with no bids submitted. The State Property Fund was able to unload its 25% stakes in DonetskOblEnergo (DOON), KyivEneergo (KIEN) and ZakhidEnergo (ZAEN) to the majority owner of all three companies, the SCM group. Only the auction for ZakhidEnegro showed any real action, with the final price for the stake coming in at UAH 130 per share, or 20% above the starting price. SCM owns its majority stakes in the companies through its DTEK Holding. We assume that DTEK intends to de-list all three companies from Ukrainian Exchange. We expect minority shareholders to receive the opportunity to sell their shares back to DTEK in case they vote against the de-listing at corresponding shareholder me