For Ukraine, a country struggling to change its oligarch-run economy to a competitive one, 2017 has been one more example that the country has a long way to go. Here are the top five deals of the year:
PrivatBank
After the government guaranteed $5.6 billion in cash allegedly embezzled by billionaire oligarch Igor Kolomoisky and Gennadiy Bogolyubov from PrivatBank, it’s hard not to conclude that the year’s biggest deal was the government’s decision to neither investigate nor prosecute the pair for this massive theft through insider loans, and to block attempts to retrieve the money in London.
Eurobond sale
Ukraine raised $3 billion on international capital markets in a September Eurobond issuance, reflecting either optimism among foreign investors or a dearth of options in the global bond market or both. The government proved it could find financing other than from the International Monetary Fund, its main backer, leading to backsliding in IMF-mandated reforms.
Rotterdam+
Billionaire oligarch Rinat Akhmetov lost control of 40 factories in Russian-occupied Donbas, while his energy company DTEK saw a huge spike in profits thanks to the country’s Rotterdam+ scheme — a generous pricing formula which seems to have no economic rationale beyond enriching coal-producing oligarchs. Under the lavish subsidy, Ukraine prices coal at Netherlands rates plus the cost of transportation to Ukraine. Akhmetov added $1 billion in 2017 from his 2016 net worth, according to a Bloomberg calculation.
Russian exit
Russian companies exit Ukraine, selling off at least $150 million in assets. Russian insurer Ingosstrakh, Lukoil, and Evraz all sold out this year to Ukrainian investors.
Tigipko’s return
Businessman and PrivatBank founder Sergiy Tigipko bought Sberbank subsidiary VES Bank, $43 million in liabilities of the defunct DiamantBank and two factories from Russian investors this year.
