The fizz surrounding the auction of Slavneft, one of
only two big oil companies still owned by the Russian state,
turned into a froth as nearly all of Russia's oil majors have
scratched together the $2 billion Slavneft is expected to
fetch when it is sold this month.
The auction is the first real test of president Vladimir Putin's
government's ability to privatize in a fair and transparent manner.
It is also an opportunity for Russia's oil companies to rationalize
their structures, with a string of side deals agreed ahead of the
auction.
The state decided to sell Slavneft because it is short of money.
Sovereign debts suspended for five years during the financial
crisis in 1998 come due next year. It had hoped to raise cash by
selling off 5.9% of LUKoil this summer. The sale was expected to
raise about $800 million but was cancelled at the last minute
because of the weak...
