State-owned Uztelecom decided to IPO 2% of its authorized capital with book value of UZS 1,154 worth UZS 6.4Bn ($5,2Mn) on Republican Stock Exchange "Toshkent", reported "Capital Markets."
According to UzA, on March 24, President Shavkat Mirziyoyev chaired a meeting focused on the advancement of state asset privatization and the objectives for the ongoing year. The primary goal of this privatization endeavor is to reduce the government's role in the economy while fostering a culture of private ownership. Uzbekistan has embarked on an extensive effort in this direction. In the past decade, state assets worth UZS 1.2tn($98Mn), were privatized, but in 2022 alone, this number surged to UZS 11.3tn($924Mn), demonstrating a tenfold increase in effectiveness within a single year.
The efficiency of privatized entities is on the rise, with examples such as the transformation of the dormant Andijan Experimental Plant into a textile enterprise, attracting $18Mn in investments and generating a thousand jobs, along with $40Mn in exports. Foreign investors have acquired and significantly expanded the Kokand Superphosphate Plant, making it four times more productive. Furthermore, notable deals include the sale of the state's stake in "Ipoteka-Bank" for $324Mn and in "Coca-Cola Uzbekistan" for $252 million.
However, the pace of privatization varies across regions and industries. While the Tashkent region successfully sold 112 assets, leading to the establishment of 150 entrepreneurial entities and over a thousand new jobs, some regions like Karakalpakstan, Kashkadarya, Namangan, Surkhandarya, and Syrdarya faced challenges, with 30% of properties remaining unsold. The privatization of assets within the Joint-Stock Company "Uzdunmahsulot" also experienced slower progress.
To address these issues, the President has endorsed a comprehensive new privatization program through a presidential decree, encompassing three primary directions: the sale of shares, real estate, and the organization of Initial Public Offerings (IPOs).
The first facet involves the sale of government-owned shares in 1,000 companies.
The second aspect encompasses the auctioning of 1,000 real estate properties, including land and structures, amounting to 1Mn square meters. These properties come with infrastructure and are conveniently situated near populated areas.
To expedite property sales, the preparation period will be reduced from 80 to 48 days, with entrepreneurs having the option to directly apply for properties under 2,000 square meters in size.
The third dimension involves the sale of the government's shares in 40 major companies and banks via a "People's IPO." For the first time, the public will be offered shares with an average yield of 2% in major enterprises, like Navoi and Almalyk Mining and Metallurgical Combinations, Uzbek Metallurgical Plant, "Uztelecom," National Bank, and "Sanoat Qurilish Bank." This offers the public the chance to buy shares directly from these companies. Companies whose shares are acquired through IPOs will allocate no less than 30% of their net profit to dividend payouts over a 5-year period.
This program is expected to bring in UZS 13tn ($1BN) in revenue this year, creating 3,000 new businesses and 50,000 jobs.
The meeting addressed these tasks with regard to regions and industries, emphasizing the importance of widespread information dissemination to the public and entrepreneurs about the opportunities in privatizing state assets and assisting with document processing. Additionally, instructions were given to bring major state companies to the capital market and enhance the effectiveness of investment projects.
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