Page 37 - Uzbekistan rising bne IntelliNews special report

bne December 2021 Special Report: Uzbekistan Rising I 37
Uzbekistan privatisation: “There is no other way”
“The sale of the Coca-Cola plant was also completed during the economic forum in September at a price of $250mn, which was twice the valuation going into the deal and x16 EBIDTA.
It was a highly successful deal,” Akram Mukhamatkulov and Shokhrukh Okhunov, who run Uzbekistan’s department for the transformation and privatisation of SOEs at SAMA
in Tashkent, told bne IntelliNews. The Uzbek Coca-Cola plant was
purchased by the Turkish Coca-Cola İçecek (CCI) Group, one of the biggest structures in the Coca-Cola empire, which bought the government’s 57.1% stake in the company after a successful bid in a privatisation auction run by SAMA. The deal was launched as an open tender in line with the presidential decree dated October 27, 2020. Investment bank Rothschild & Co. acted as financial advisor to the government and Denton’s as legal advisor.
“CCI was one of seven bidders, but the first to apply when the auction process was launched in January 2021,” Mukhamatkulov and Okhunov said, “but all the bidders were all very keen. There were also bidders from the US, Turkey, Israel and elsewhere, which drove the price
up to double the starting price.”
Governments are usually cautious about selling off their biggest and best SOEs, concerned to get the best price possible for their industrial family jewels, but during a course of the interview by
bne IntelliNews representatives of the state said over and over again: the state
Ben Aris in Tashkent
T
government building in Tashkent and a new addition to the government following the moribund days of the previous Karimov administration.
The old system had changed little from Soviet days, where the state owned almost everything of value. Run by “red directors” and managed using state orders, quotas systems
and decrees, little real business was done. But all that has changed now. The job of the Uzbekistan State Assets Management Agency (SAMA) is to sell pretty much everything the state owns to private investors – domestic and international – and to do it quickly.
Uzbekistan's privatisation programme has been in development for several years, and now the first wave of candidate companies has been prepared the number of auctions is snowballing. This year has already seen more sales completed than all the sales made in the last four years taken together.
he offices of Uzbekistan State Capital Investment
Agency are an unassuming
During an economic forum organised by the Ministry of Finance in September, more than $250mn worth of privatisation deals were closed, including the Coca-Cola bottling plant and the first two banks that kicked
off the privatisation of Uzbekistan’s financial sector that will see many of the biggest banks flogged to the highest bidder in the next few years.
As bne IntelliNews reported, the entire cotton sector – the backbone of the economy since Soviet times
“There is no other way,” is a mantra repeated by one state official and head of a large industrial concern after another”
– has already been completely sold off, and the same privatisation of wheat production, also a strategically important sector, is anticipated to
be complete by the end of 2022.
companies needs to be sold off and given to the private sector. “There is no other way,” has been a mantra repeated by one state official and head of
a large industrial concern after another
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