02 June 2004 19:30
Letter: Overlooking Sibneft`s successes
ByLine: EUGENE SHVIDLER
Adrian Levy and Cathy Scott-Clark paint a canvas with broad strokes about the privatisation of Sibneft and its effect
on the people working here (He won, Russia lost, Weekend, May 8). The impression given is that only a handful of
businessmen like Roman Abramovich were out in western Siberia in the early 1990s buying up the privatisation vouchers
that could be traded for shares in companies like the ones later united into Sibneft. In reality, trading in vouchers
was widespread and legal, just like sale of any stock or security.
The legal action referred to by Levy and Scott-Clark regarding a new share issue in Sibneft's Noyabrskneftegas
(NNG) subsidiary is misrepresented. True, Sibneft did compel NNG to issue new shares in order to infuse the subsidiary
with capital, a vital step in trying to modernise the company. How ever, in 1998-99, Sibneft also issued new shares in
the parent company to NNG's minority shareholders. Our goal was to create an integrated oil company. The only
lawsuit was brought not by Sibneft employees, but by a large foreign institutional investor. A mutually acceptable
settlement was later reached.
Levy and Scott-Clark listed Kenneth Dart among Sibneft's current core shareholders; in fact he sold his
independent stake in Sibneft about five years ago.
What Levy and Scott-Clark neglected to tell was the success story that Sibneft represents. It is widely regarded as
one of Russia's most progressive companies. Our management team took a group of inefficient, bankrupt companies and
turned them into a model for efficiency. Sibneft is now among the world's fastest-growing energy companies, with
production ris ing by 19% or more annually over the past four years.
Our employees have benefited from this growth. Salaries at NNG, for example, rose by 22.1% last year and wages at
each of Sibneft's other operating units rose similarly. Employees receive a broad benefits package and a large
percentage of them are also shareholders, thus profiting from the upside in our stock price and our dividend policy. The
communities in which Sibneft operates also benefit with various infrastructure projects and charity programmes.
I do not dispute that some individuals fared better than others during Russia's transition in the 1990s, though
I would ask you how many really benefited directly from the major privatisations in the United Kingdom in the latter
part of last century.
Eugene Shvidler
President, Sibneft
[The Guardian] |
RUSSIA IN FACTS
