Janis Naglis News

Latvia's privatization agency said on Thursday several potential bidders were interested in a 68 percent stake in Latvian Shipping. The deadline to submit such expressions of interest is February 1 and this tender is the fourth attempt to sell the controlling stake in the firm after previous attempts failed due to little interest and political bickering. "We have several applications... more than one, from several continents," privatization agency head Janis Naglis told a news conference. Economy Minister Aigars Kalvitis said participation of international advisers and surveillance from local NGOs would secure transparency in the process. The 136 million state-held shares are expected to be sold and paid for by June.

Latvia may drop certain key conditions in a fresh attempt to privatize Latvian Shipping but could keep the offered stake at 68 percent. Latvia's cabinet officially admitted defeat on Tuesday in its fourth attempt to sell the sea cargo firm and ordered the economy ministry to draw up a new tender for its privatization. "The variant offered could contain giving up on the strategic investor, but I do not see any arguments why we should give up the current stake (to be offered)," privatization agency head Janis Naglis said. Naglis said giving up on a strategic investor meant scrapping several key requirements, including future investments, keeping the firm in the shipping business and limits on reselling it. Without these requirements, the potential range of bidders could widen.

Latvia's government officially admitted defeat on Tuesday in its fourth attempt to sell sea cargo firm Latvian Shipping, ordering the economy ministry to draw up a new tender to sell the firm. "The government decided to stop the Latvian Shipping privatization process based on the current rules and asked the economy ministry to prepare new guidelines within two weeks in order to continue," Economy Minister Aigars Kalvitis said. Privatization officials were sent back to the drawing board last month after the two finalists selected by the government failed to submit a bid bond to take part in an auction for a 68 percent stake, which had been set for May 11.

The ongoing saga to partially privatize the world's 19th largest shipping company took another turn last week, as officials with the Latvian Privatization agency confirmed that final selloff rules for 100-percent state-owned Latvian Shipping are expected to be approved this week. But the process to sell the company has been marked with so much turmoil that the news did little to encourage potential investors. Latvia's government officials, however, said the sale could take place by the end of the year, leaving the final rules to be settled by the agency. The Agency has already sent out preliminary guidelines passed by the cabinet to 15 potential investors, including shippers and investment funds in Scandinavia, U.K. and the U.S., Privatization Agency head Janis Naglis said.

Latvia's privatization agency said that Japan's Mitsubishi group had expressed interest in the privatization of Latvian Shipping. "Companies that are expressing their interest for the first time have appeared," agency head Janis Naglis told a news conference, adding that Mitsubishi was one of them and that sell-off rules had been sent to 20 potential bidders. "Latvian Shipping privatization terms have been sent to all interested groups - 14 industrial partners and six potential financial investors," Naglis said. The agency has set the minimum share price for a 34 percent of Shipping's 200 million shares to be sold at 0.51 lats, although a firm date for the auction has not yet been scheduled.

Latvia's Privatization Agency said Russian LUKoil Tankers have shown active interest in the sell-off of a 44 percent stake in Latvian Shipping. "We have had the most active correspondence with LUKoil Tankers, which of course does not rule out other participants in the final bidding," Janis Naglis, privatization agency director, said. "I would not be surprised if LUKoil Tankers decided to participate in the Latvian Shipping sell-off. It has free funds and ambitious plans to increase its fleet," Naglis said. Naglis added that the agency plans to distribute an international audit of Latvian Shipping's nine-month results to potential bidders soon. "We hope to be able to send (the audit) out to potential bidders on December 7, with the list comprising some 46-47 entities," he said.