Press Release
Preparations for Gazprom Shares Market Liberalization
The format for consolidating Gazprom control stake in the state ownership has been finalized in a move to fulfill a message from the President of Russia ordering preparations for Gazprom shares market liberalization.
100% of Rosneft stock will be privatized and will become part of the authorized capital of OAO Rosneftegaz (the first stage). Then OAO Rosneftegaz will buy out Gazprom shares from Gazprom affiliate companies at the market value in quantities required to ensure a control stake for the state. This deal is expected to be funded by borrowings from leading global financial institutions.
Thus, in the first stage the state will gain control over Gazprom by consolidating into a control stake Gazprom shares held by the Federal Agency for Management of Federal Property (Rosimushchestvo) and its affiliate entities (OAO Rosneftegaz and OAO Rosgazifikatsiya). This will be followed by Gazprom shares market liberalization removing double regulation of Gazprom shares.
Part of Rosneft stock will then be placed on the open market to attract funds to pay off the current debt and raise Rosneft capitalization (the second stage). This will also make Rosneft an investor-attractive publicly held oil company.
Rosneft stock placement will be followed by winding-up of OAO Rosneftegaz. This will make the state a direct majority shareholder in Gazprom and Rosneft.
An action plan has been finalized to carry out the above, providing the first stage to be completed by June 24, 2005, i. e. the date of Gazprom's general meeting of shareholders.
Morgan Stanley, which is working on Rosneft assets appraisal and an updated assessment of Gazprom stock value has prepared a tentative estimate of Rosneft shares valuation range.
Morgan Stanley is to submit its final report on Rosneft valuation and Gazprom stock value assessment to the Federal Agency for Management of Federal Property (Rosimushchestvo) on May 19, 2005. Dresdner Kleinwort Wasserstein, working under contract with Gazprom, is expected to submit its report on the required Gazprom shareholding by the same date.
