Gazprom chairman promises removal of share restrictions

  • Business
  • Friday, 24 Jun 2005

MOSCOW (AP) - The chairman of Russia's natural gas giant Gazprom promised Friday that restrictions on foreign stock ownership in the world's biggest gas producer would be lifted by the end of the year. 

The liberalization plans will give investors the chance to buy stock in a company that commands one-fifth of the world's gas reserves, and their initial announcement in September won kudos from a business community shaken by the legal assault on the Yukos oil company. 

They also fit in with the Kremlin's campaign to reassert authority over Russia's vast and lucrative hydrocarbon resources. 

Dmitry Medvedev, who serves simultaneously as the Kremlin chief of staff and chairman of the Gazprom board, said that the liberalization "is not only a significant and long-awaited event, but also an important step in developing the entire Russian stock market,'' the ITAR-Tass news agency reported. 

He confirmed that the state had concluded a deal to take control of Gazprom, a key requirement for the liberalization to move forward. 

"All the transactions have closed and have taken effect,'' he said according to Dow Jones Newswires. 

Under the deal, the state will pay just over US$7 billion (euro5.8 billion) to increase the state's ownership in Gazprom to over 50 percent.  

Earlier in the week, Trade and Economic Development Minister German Gref said that the money for the required 10.74 percent stake, which Russia will borrow from foreign banks, would be transferred by the end of the year. 

Medvedev's comments contrasted with a report in the Vedomosti business daily on Friday that quoted sources close to Gazprom as saying that one of the company's subsidiaries could transfer a portion of the shares a week late. 

Foreigners currently have only limited access to Gazprom stock: Just over 4 percent of the company is traded overseas at a considerable premium to local shares. - AP 

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