Bloomberg News

Kazakhs Plan KazTransOil IPO in October, Grid Sale Next Year

March 13, 2012

Kazakhstan plans to sell shares in oil pipeline operator AO KazTransOil in October, the first offering in a so-called People’s IPO program to lure investment.

“The world economy is not stable so it is reasonable to first hold KazTransOil’s IPO in 2012 and to postpone Kegoc’s IPO until next year,” Trade and Economic Development Minister Bakytzhan Sagintayev told reporters today in Astana. The pipeline operator is more advanced in its preparations for an initial public offering than AO Kazakhstan Electricity Grid Operating Co., which is known as Kegoc, he said.

Shares in the power grid may be sold as early as the fourth quarter of this year or in the first quarter of 2013, after the KazTransOil sale, targeted for October, said Kuandyk Bishimbayev, deputy chief executive officer of the sovereign wealth fund Samruk-Kazyna, which holds the state’s stakes.

Kazakhstan will proceed with the plan to sell shares in state companies to citizens even as an “inevitable” global crisis looms, Prime Minister Karim Massimov said on Jan. 23. The “most successful time” for the IPOs is when markets have fallen, so that citizens will be able to sell shares they purchased for a “big” profit during future stock placements in Hong Kong or London, Massimov said.

Kazakhstan aims to attract investment after Samruk-Kazyna bailed out banks and companies hit by the credit crunch of 2007 to 2009, while maintaining control of assets that account for half of economic output.

Stakes of 5 percent to 15 percent will be sold, Deputy Prime Minister Kairat Kelimbetov said last August, when he was economic development and trade minister.

Other companies on the privatization list include energy producer KazMunaiGaz National Co., nuclear holding Kazatomprom, postal system Kazpost, rail monopoly Temir Zholy and natural-gas pipeline operator AO KazTransGaz.

To contact the reporter on this story: Svetlana Antoncheva in Astana, Kazakhstan at santoncheva1@bloomberg.net

To contact the editor responsible for this story: Hellmuth Tromm at htromm@bloomberg.net


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