Kazakhstan Chamber of Commerce in the USA

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Kazakhstan to create a cargo airline 0

Posted on November 21, 2016 by KazCham

Centil Law Firm BI@centil.law

This task is assigned to the national carrier Air Astana together with the state logistics operator Kazakhstan Railway. According to the railway operator, the new cargo airline will begin flights in 2017, with China, Europe, Iran, Russia and Turkey among the first destinations.

Kazakhstan is now actively working on the development of freight hubs in the country’s airports. This year, the air hub of Karaganda was the first air harbour in Kazakhstan, which has been validated according to the requirements of European aviation authorities RA3.

Kazakhstan approves list of state companies offered for privatisation 0

Posted on January 14, 2016 by KazCham

Colibri Law Firm BI@colibrilaw.com

The government of Kazakhstan has approved a list of state companies to be offered for privatisation as part of its long-term privatisation plan for 2016-2020.

The plan approves a list of large state-owned companies and organisations that will be privatised, and includes the pharmaceutical company SK-Pharmacy, national space company Kazakhstan Garysh Sapary, state road enterprise Kazakhavtodor, Khorgos international centre of cross-border cooperation, the airport of Astana, the Almaty sanatorium, the Kazakh national film studio, the airports of Kostanai and Petropavlovsk, the Korkyt Ata airport in Kyzylorda, and the Duman entertainment centre in Astana.

The list for priority privatisation also includes the national railway company Kazakhstan Temir Zholy (through IPO), national oil and gas company KazMunayGas (IPO), national atomic company Kazatomprom (IPO), national post service Kazpost (IPO), airlines Air Astana (IPO) and Qazaq Air, national telecommunications operator Kazakhtelecom, the airports of Aktobe, Atyrau and Pavlodar, the Aktau international seaport, and the national agricultural holding KazAgro.

Kazakhstan plans IPOs for 43 large state firms in 2016-17 0

Posted on December 10, 2015 by KazCham

Reuters

Nov 18 Kazakhstan plans to sell stakes of at least 25 percent in 43 large state-owned companies via initial public offerings (IPOs) in 2016-17, the Samruk-Kazyna sovereign wealth fund said on Wednesday.

The government faces a plunge in revenues from oil, Kazakhstan’s main export. President Nursultan Nazarbayev told a government meeting on Wednesday he wanted Kazakh businessmen and companies to take part in the privatisations.

The stakes will be sold on the floor of the oil-rich nation’s financial centre being built in the capital Astana, the fund said.

The businesses to go public include oil and gas company KazMunaiGas, uranium company Kazatomprom, railway company Kazakhstan Temir Zholy and mining firm Tau-ken Samruk, it said.

Tau-ken Samruk has a 30 percent stake in Glencore-controlled zinc producer Kazzinc.

Offered for sale will also be stakes in electricity firms united in the fund’s division Samruk-Energo.

Samruk-Kazyna manages state-owned stakes in companies representing all major branches of Central Asia’s largest economy.

Two sources close to the government told Reuters this month the companies in which the state would sell stakes included miner Eurasian Resources Group (ERG), flagship carrier Air Astana and Kazakhtelecom.

The fund said that besides holding IPOs in the 43 large companies, it would privatise 182 “non-core assets” through auctions in the same period.

The total value of the capital of all the companies slated for sell-off is around 2.5 trillion tenge ($8.1 billion), the fund said.

Kazakhstan’s Air Astana sees possible IPO in 2016 0

Posted on August 22, 2014 by KazCham

Business Intelligence from Colibri Law Firm: Issue #91

Air Astana is considering going public over the next two or three years president Peter Foster, has announced. The Wall Street Journal quotes Foster as saying an IPO had become a necessity given its ambitious expansion plans.

“There is an absolute consensus among the owners Air Astana should be listed,” airline President Peter Foster said in London Thursday.

Majority-owned by the Kazakh sovereign wealth fund, Samruk Kazyna, the carrier is a joint-venture with BAe Systems (B1, Warton) which owns the remaining 49%. On the back of growing profitability – the carrier generated a profit of USD46million last year – Air Astana has outlined plans to develop Astana into a regional and international transit hub.

With the airline’s recent removal from the European Union’s Banned Operator’s List, the carrier announced plans for services to Paris CDG and Prague (complementing Amsterdam and London Heathrow) with plans to start Tel Aviv Ben Gurion flights next year. In tandem with its international growth, so the carrier has also moved to expand its regional Asian network with the longterm aim of becoming the dominant carrier in Central Asia.

Kazakhstan’s Air Astana expects to launch domestic IPO in Q3 2013 0

Posted on October 29, 2012 by KazCham

Reuters, Oct 10, 2012

Oct 10 (Reuters) – Air Astana, the flag carrier of oil-rich Kazakhstan, said on Wednesday it was looking to float at least 20 percent of its shares in a domestic initial public offering next year to support the company’s growth plans.

The central Asian carrier, profitable since 2003, its second year in operation, is also planning a secondary listing in overseas markets, said president Peter Foster.

“In the future, there will undoubtedly be a secondary listing to enable us to access international capital markets and there will be the choice between London or Hong Kong or both,” Foster, a former Cathay Pacific Airways Ltd executive, told a news briefing in Hong Kong.

Under the country’s privatisation plan, Air Astana, national grid KEGOC and state oil transportation firm KazTransOil, were among the first batch of companies expected to be floated this year.

Foster said, however, that Air Astana’s IPO would probably take place in the third quarter of 2013.

Before the listing, the airline’s two shareholders needed to agree on the size of the share sale, he said.

“Anything less than 20 percent will be too small and wouldn’t provide sufficient liquidity,” Foster told Reuters in an interview after the briefing.

Air Astana is 51 percent-owned by Kazakhstan’s sovereign wealth fund Samruk-Kazyna and 49 percent Is held by BAE Systems Plc, Europe’s largest defence contractor.

The company’s first-half net profit net profit fell 80 percent to $4.9 million as fuel prices rose more than 140 percent year on year.

But Foster said oil prices had came off from year highs and a traditional strong second half should help lift full-year net profit to between $45 million and $50 million this year against $61.3 million in 2011.

Lifted by the booming economy of Kazakhstan, Air Astana has grown its net asset value to about $250 million from the original total investment of $17 million by its shareholders.

Although the carrier has not decided whether to issue new shares at its domestic IPO, it will have funding needs in the next few years for the acquisition of new planes.

“We don’t need the money now, but by 2014 and 2015 when the pre-delviery payment kicks in for the Boeing 787s, it is going to put us into a much more comfortable position to have more cash that we have at the moment,” Foster said.

Air Astana has placed orders to buy 15 planes, including three Boeing 787-8s, with a total list price exceeding $1.5 billion to be delivered in the next few years to help expand its capacity by 10 to 15 percent a year.

It operates a fleet of 26 aircraft, entirely leased except for two Embraer 190s it owns.

Evolution of role sees fund gearing up for ‘People’s IPO’ 0

Posted on December 25, 2011 by Alex

The heart of Kazakhstan’s economy, Samruk-Kazyna has, since its inception, played a crucial role in the country’s industry and economy. Now the fund is ready to float some  of its assets at discounted prices to retail investors. By Clare Nuttall

Kazakhstan’s sovereign wealth fund Samruk-Kazyna put to work billions of US dollars to support the economy during the global economic crisis. With Kazakhstan growing strongly, the fund’s role has evolved – it is now responsible for creating new industries and increasing efficiency in the economy’s most important companies.

This year will see further dramatic changes, as minority stakes in some of its largest and most attractive companies are floated on the domestic stock exchange. Samruk-Kazyna was created in the depths of the crisis through the merger of two existing organizations – holding company Samruk and investment company Kazyna – in October 2008, and its importance to the Kazakh economy cannot be overestimated. Its subsidiary companies include the national rail and postal companies, electricity grid operator Kegoc, state oil-and-gas giant National Company KazMunaiGas, nuclear company Kazatomprom, national air carrier Air Astana, and three of the top four banks. It is also the parent of the Damu small enterprise fund, private equity fund of funds Kazyna Capital Management, and other  financial organizations.

Overall, Samruk-Kazyna manages assets worth in excess of $70 billion, accounting for around 40 percent of the economic activity in the country. It has a total of 404 subsidiaries and affiliated companies. As of March 2010, Samruk-Kazyna announced it had invested KZT897 billion ($6.1 billion) from Kazakhstan’s National Fund to support the economy during the crisis. Its largest financial commitment was to the banking sector, where it invested some KZT486 billion.

Other anti-crisis measures included supporting the real-estate sector (KZT360 billion), support for small and medium-sized enterprises (KZT120 billion) and implementing industrial and infrastructure projects (KZT121.5 billion).

Samruk-Kazyna became the majority shareholder of  BTA Bank and Alliance Bank, injecting liquidity when both were on the brink of collapse in February 2009. Today, a debt restructuring for the two banks has been agreed with creditors.

At the same time, the fund took minority stakes in Kazakhstan’s other big-four banks, Halyk Bank and Kazkommertsbank. Now that GDP growth in Kazakhstan has returned to pre-crisis levels, Samruk-Kazyna is starting to divest some of the assets it acquired during the crisis. The fund has already exited its investment in Halyk, selling the stake back to the bank and its majority shareholder Almex.

Kazkommertsbank could buy back its shareholding in the near future. A sale of BTA to Russia’s Sberbank is still on the cards and Samruk-Kazyna is also looking at potential exit routes for Alliance, but it is adamant that it will sell its shareholdings only if the price is right.

Post crisis, Samruk-Kazyna is involved in raising the efficiency of its subsidiaries, and is the main conduit for big foreign investment projects. The emphasis within Kazakhstan has shifted toward production of processed and value-added products, rather than being purely a supplier of raw materials.

Several of the priority projects within the 2010-14 Accelerated Industrial and Innovative Development program are aimed at achieving this goal. Samruk-Kazyna is already working to diversify and industrialize Kazakhstan. The ‘breakthrough projects’ under the Samruk-Kazyna umbrella include reconstruction of the Atyrau refinery, modernization of the national electricity grid and construction of several new power stations. Within Samruk-Kazyna, two holding companies created in late 2008 are responsible for the chemicals and metals sectors, respectively. The United Chemicals Company was set up to develop a national chemicals industry and reduce Kazakhstan’s dependence on imports of products such as fertilizers. Tau Ken Samruk is the holding company for the Kazakh government’s stakes in metals and mining companies. While oil and gas still account for the lion’s share of Kazakhstan’s exports, metals and mining have been growing in importance in recent years.

Soaring metals prices, and the steady growth in demand from neighboring China in particular, have provided an impetus for Kazakhstan to increase its output. The government stakes in two major London Stock Exchange-listed mining companies – Eurasian Natural Resources Company (ENRC) and Kazakhmys – are held within Tau Ken Samruk. Both companies have an immense presence in the Kazakhstan mining sector, as well as internationally.

Kazakhmys is the largest copper producer in Kazakhstan and one of the top 10 producers worldwide. ENRC – a diversified natural resources group – has a presence in China, Russia, Brazil and Africa, as well as in Kazakhstan. This year has already seen significant changes for Samruk-Kazyna. On April 12, Timur Kulibayev was promoted to chairman as part of the post-elections reshuffle. Kulibayev, the son-in-law of Kazakh president Nursultan Nazarbayev, was previously the company’s deputy chairman.

The fund’s main task this year will be to carry out the ‘People’s IPO’ program, under which shares in companies that are wholly or partly owned by Samruk-Kazyna will be offered at a discount to retail investors and pension funds. In addition to raising funds for expansion, the program is also intended to stimulate the domestic capital market.

At least some of the IPOs are due to take place by the end of this year. Companies expected to be part of the first wave of IPOs include power-generation company Samruk-Energo, electricity grid operator Kegoc, postal service Kazpost and KazMunaiGas Exploration and Production. In the following two years, IPOs of other companies – including Kazatomprom, National Company KazMunaiGas, and railway operator Kazakhstan Temir Zholy – are planned.

SOURCE: Invest in Kazakhstan, 2011, p. 45-46

Air Astana to Boost Long-Haul Frequencies and Launch Almaty-Hong Kong Route 0

Posted on November 12, 2011 by Alex

Airlines and Destinations, Oct 31, 2011

As a result of strong traffic growth on its Asian network, Kazakhstan’s flag carrier Air Astana is planning to boost service frequencies on its scheduled services from Almaty to Bangkok, Delhi and Kuala Lumpur from December.

Services from Almaty to Bangkok will increase to five round-trips a week. Air Astana will increase its Almaty-Delhi flights to four times a week and its Almaty-Kuala Lumpur services to three times a week.

Air Astana will also launch a new twice-weekly nonstop service linking Almaty with Hong Kong in February 2012 and a winter-season-only service between Almaty and Ho Chi Minh City in Vietnam in October 2012.

Kazakhstan flag carrier Air Astana has ordered six Embraer 190s and optioned two more to build its regional network from Almaty and Astana, Kazakhstan’s two largest cities. Air Astana also operates Airbus A320-family jets, Boeing 757s, Boeing 767-300ERs and Fokker 50 turboprops

The airline will operate all the additional long-haul services with Boeing 757s and Boeing 767-300ERs, which offer Business class cabins featuring lie-flat beds and KCTV personal in-flight entertainment systems.

“Expanding political, business and tourism links between Kazakhstan and Asia continue to drive strong traffic growth  on services to the region, with increased feed from Central Asia into the expanding Almaty hub also making a significant contribution,” says Peter Foster, president of Air Astana. “Immediate frequency increases on existing services and the launch of new services to Hong Kong Kong and Ho Chi Minh City in 2012, reflect the fact that Asia is playing an increasingly important part in the strategic long-term development of Air Astana.”

Air Astana operates a fleet of 25 aircraft, the fleet comprising two Boeing 767-300ERs, four Boeing 757-200s, 10 Airbus A320-family jets, three Embraer 190s and six Fokker 50 turboprops.  A fifth Boeing 757 will join the fleet in December 2011. The airline serves 23 domestic and 31 international destinations.

Almaty-based Air Astana is a member of the International Air Transport Association and the only airline in Kazakhstan certified to perform aircraft maintenance to European standard EASA/Part 145. In September,  Air Astana passed its third IATA Operational Safety Audit without any findings.

Air Astana is a joint venture between Kazakhstan’s Samruk-Kazyna JSC National Welfare Fund and British company BAE Systems, the partners respectively owning 51 per cent and 49 per cent shareholdings.

SOURCE: http://www.kazakhembus.com/index.php?mact=News,cntnt01,detail,0&cntnt01articleid=793&cntnt01origid=15&cntnt01returnid=201

“People’s IPO” to create wealth, bolster capital markets 0

Posted on October 31, 2011 by Alex

The dual goal of the planned “people’s IPO” program is to create a wealth creation conduit for the Kazakh population and  to  bolster  the  development of domestic capital markets, Marcia Favale-Tarter, an investment banker and advisor to Kazakhstan’s Prime Minister Karim Masimov, told Bloomberg on the sidelines of the Kazakhstan Business Forum in London last week.

The “people’s IPO,” a privatization program in which the Kazakh government will sell stakes in some of the country’s largest companies to domestic investors, will help create an investment culture among the Kazakh population, improve corporate governance, and bolster the development of the country’s investment infrastructure, according to Favale-Tarter. Air Astana, KEGOC, and KazTransOil will headline the offerings, but “all companies underare being evaluated.”

SOURCE: SRI, Kazakhstan Daily News Brief, dated 24 October, 2011, available at http://silkroadintelligencer.com/wp-content/files/srikznewsbrief_oct24_2011.pdf

Kazakhstan Daily News Roundup – September 28, 2011 1

Posted on September 28, 2011 by Alex

Kazakhstan Daily News Roundup – September 26, 2011 0

Posted on September 26, 2011 by Alex

ENERGY:

Tengizchevroil pays $11.5-million environmental fine – PGO (SRI)

KMG, Sinopec sign agreement on cooperation (SRI)

BUSINESS AND ECONOMY:

Kazakhstan faces growing need for warehouse space
(bne) – New modern warehouses are being built in Kazakhstan, but the country still has a pressing need for more, especially in the far-flung central and western cities where food is still stored in rat-infested Soviet buildings.

KASE Index falls 6.74% on Thursday and Friday (SRI)

BAE may sell part of Air Astana stake in preparations for “people’s IPO” (SRI)

Kazakhstan to produce 25 million tonnes of grains this year (SRI)

Kazkommertsbank to liquidate Netherlands-registered subsidiary (SRI)

Kazakhstan sees GDP growth at 7% for 10 years – Foreign Minister (Reuters)

Kazakhstan, Turkmenistan to commission rail link in October (SRI)

Kazakhstan keen to expand UAE trade ties (Khaleej Times)

Tajik Air planes refuel in Kazakhstan (Trend)

Kazakhstan not to export wheat to Iran (Trend)

Indicators – September 23, 2011 (Reuters)

POLITICS AND SECURITY:

Russia, Kazakhstan may merge air defense systems – RIA Novosti (Bloomberg)

Nazarbayev reiterates Kazakhstan’s willingness to house nuclear fuel bank (Interfax)

SOCIETY:

Energy coin fuels Kazakh production plans (Variety)

REGIONAL:

Mongolia’s high plains herders warily eye coal truck (Reuters)

New ‘Silk Road’ eyed for Afghanistan (AFP)

SOURCE: http://silkroadintelligencer.com/2011/09/26/kazakhstan-daily-news-roundup-september-26-2011/



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