/ADDITION/ Kazakhstan exhibits for sale state blocks of shares of 3 enterprises of metallurgy

/REUTERS, Almaty, Denis Demkin with participation of Raushan Nurshayeva in Astana, October 4, 02/ - Kazakhstan exhibits for sale state bocks of shares of three largest metal producers - Aluminium of Kazakhstan OJSC, copper corporation Kazakhmys and Ust-Kamenogorsk titanium-magnesium combine, told Murat Buldekbayev, press-secretary of the country's prime-minister to Reuters on Friday. According to his words 31.76% of shares of Aluminium of Kazakhstan, 24.65% of Kazakhmys shares and 15.5% of shares of Ust-Kamenogorsk titanium- magnesium combine are exhibited for sales at the trades of Kazakhstan stock exchange (KASE). "The mechanism (of blocks sale) will be determined by the stock exchange", - he said. The Government believes that shares will be sold till the end of 2002. "It is doubtless that it will occur in this year", - said Buldekbayev. According to the words of the press-secretary, the major purpose the Government wants to achieve is revival of shares market in Kazakhstan. "This (blocks of shares sale) had been also planned before, but now the necessity of stock market revival becomes obvious ", - he said. Later on, at the press-conference in Astana the first deputy Chairman of the State committee of property of the Ministry of finance Eduard Utepov said that information about sale of the state block of shares of Aluminium of Kazakhstan and Ust-Kamenogorsk titanium-magnesium combine will be published in the official press the next week. "In 15 days (after that) trades at the stock exchange will start" - he said He did not tell the date of sale of state block of shares of Kazakhmys. "It will be after finishing of works on pre-sale preparation", - said Utepov. "According to the form these, most probable, will be trades on counter offer, with cutting-off element. But details will be recommended to us by the stock exchange", - he added. Utepov refused calling the starting price of the state blocks and how mach Kazakhstan intends to make from the sale. "Our task is to receive maximal sum from these shares sale... I would not like to call any figures. I hope, level of sale will not be lower than last year". In November of 2001 at KASE auction 10% stat block of shares of Kazakhmys was sold for $63.15m, price of one share equaled to $128.6. The stock exchange did not call the purchaser. Later the stock exchange informed that the owner of 10% of Kazakhmys's shares is Alma-Ata broker company, which services Kazakhsmys. "Of course, the biggest sum will be received from Kazakmys's shares sale", - assumed Utepov. In 2001 the Government's representative informed that Kazakhstan intended to make KZT26.6bn from privatization in 2002. NEW INSTRUMENT FOR INVESTORS Utepov made it clear that the Governments expects that the state blocks of shares will attract the biggest domestic investors - pension funds and banks, which have deficiency of instruments for investments after the redemption of sovereign euronotes of Kazakhstan, which was made on October 2 for the amount of $350m. About $210m out of total sum came to domestic market. As the result, the National Bank had to keep reduction of dollar price: trades volume of Thursday, October 3 increased to $36.7m from $4.9m on previous day. On Friday volume of trades equaled to $257m. Eurobonds of the state Development bank, internal tenge securities of the Ministry of finance, notes of the National Bank, and possibly, shares are to be the substitution for the redeemed eurobonds in investors' portfolios: in September the National Bank changed acting limits of investing of pension assets towards increase of the part of corporate securities. Utepov said that the form of state blocks sale will be chosen taking into account pension funds' interests. "Probably there won't be the sale in one lot, because in this case we will cut-off pension funds - they have the right to purchase up to 5% of enterprise's shares. But the size of lots, 5 or 1%, will be determined by us together with the National Bank and the stock exchange", - he said. In 2001 5% of Kazakhmys's shares from the state block of shares were exhibited at stock exchange's trades, but purchased only 0.35%. Non-residents will also be able to purchase the shares, informed Utepov. "Since we conduct these trades without any limits, I think, there will be very large number of participants... Non-residents too", - he said. Kazakhmys with the headquarters in Zheskazgan, partially belongs to South- Korean Samsung, which jointly with affiliated company possesses 32% of its shares. In January-August of 2002 Kazakhmys increased copper production up to 286,500 tons from 273,000 tons within similar period of last year. Aluminium of Kazakhstan, whichi s controlled by Eurasian industrial association, intends to increase production volume in this year up to 1.4 million tons of alumina a year 1.2m in last year. Kazakhstan, where there are no aluminum production, exports raw stuff - mainly to Russia. The company has started modernization of its production capacities, which had been planned for five years, and which was estimated at $60m and strived for improving of production quality. 66% of shares in the capital of Ust-Kamenogorsk titanium-magnesium combine belong to Belgian Specialty Metals Company S.A. ($1=KZT154.5) [2002-10-04]