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Privatization may go further for state companies

Finance Minister Kudrin says if the market situation is favorable the government may decide to reduce its holding in major state controlled companies to 25% plus one share, as part of its privatization plans.

Currently the state is planning to retain 50% plus one share in the ten large companies on the privatization list. But a key target of state privatization according to Ministry of Economic development is to attract investors for companies’ modernization and development.

The first companies for slated for privatization are now being prepared. Deputy Prime Minister, Sergey Shuvalov, says the government may offer major stake in state owned companies if it sees a better market conditions.

 “We are ready to offer 100% of state shares in several companies if it matches the market conditions and government key principles.”

Oleg Vyugin Chairman of the board of Directors MDM-Bank says easing government control of state companies will boost efficiency in the companies.

“If company is a fully market company which is acting in a competitive environment then the best decision is to privatize this company fully because in this case efficiency of this company will be much higher than state shareholder and serious shareholder of this company it would be better for fair competition in the country and a fair competition is a key of efficiency.”