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Moscow / AFP
The Russian government has unexpectedly halted the sale of its stake in oil producer Bashneft planned as part of a privatisation drive to shore up dwindling financial reserves, reports said Wednesday.
The decision to postpone the sale indefinitely, reportedly taken by Prime Minister Dmitry Medvedev and agreed with President Vladimir Putin, came after the economy ministry collected bids from interested companies for the sale—worth $4.7 billion according to various estimates.
The Russian government owns 50.08 percent of the company, while a quarter plus one share is held by the Bashkortostan region on the Volga region where Bashneft is based.
The government’s stake was part of its privatisation drive for this year, according to a May decree. Neither Medvedev’s press spokesman nor the economy ministry have responded to an AFP request for comment.
Bashneft shares meanwhile plummeted after trading opened, down 10 percent at 0900 GMT on the Moscow Stock Exchange.
The Russian economy is suffering a protracted recession exacerbated by low oil prices, a major source of budget revenue.
The decision to halt the Bashneft sale means that the state’s reserve fund, which has been propping up the budget, will run out this year, Vedomosti daily said, quoting a government official. Russian media has speculated that the sale was stopped for political reasons after disagreements over who should participate, notably between the oil giant Rosneft and the private firm Lukoil.