The effectiveness of state asset management in Ukraine has always been questionable. A clear example of how not to do this is shown by the current management of the State Property Fund ("SPF") which is actively dismissing effective managers. Moreover, they are doing so amidst a catalogue of violations. Why is this done? Read more with Lenta, UA.
Let's start with the legislation. On March 25 this year, the Cabinet of Ministers adopted Resolution №256, according to which it requires “public economic entities that are of strategic importance to the economy and the security of the country to refrain from personnel changes in the governing bodies in order to ensure uninterrupted work in quarantine.” However, and on the contrary, the SPF seems to have decided to take advantage of a power vacuum of the lock down to replace Oleg Kozachuk, the popular head of the largest and most successful state owned regional energy company, Khmelnytskoblenergo (Khmelnytsk region electricity distribution system operator (DSO).
The appointment of a new acting General Director of Khmelnytskoblenergo was carried out in gross violation of the law by illegally assigning the functions of a member of the Supervisory Board of Khmelnytskoblenergo to two representatives of the State Property Fund, after their predecessors were removed from the same Supervisory Board in an earlier special operation. As a result at a meeting of the Supervisory Board on April 28 Kozachuk was dismissed by an apparent 5 votes out of 7, appointing Valery Goponov in his place. However, in fact, it appears that the number of votes of the members of the Supervisory Board was not 5, but 3.
According to experts, the head of the State Property Fund Dmytro Sennichenko and his deputy Serhiy Ignatovsky are actually destroying some of the successful enterprises that remain in the hands of the state. And they are clearly doing this is at the wrong time; when companies must be headed by successful managers. Oleg Kozachuk certainly belongs in this category of managers.
A holder of the title Honoured Power Engineer of Ukraine, Kozachuk managed Khmelnytskoblenergo from 2016 to 2020. It is noteworthy that during this period the company increased its profit 10 times, reaching 85.7 million hryvnias, exceeding the profit of other 4 state oblenergos (Kharkivoblenergo, Zaporizhzhyaoblenergo, Mykolaivoblenergo, and Ternopiloblenergo) combined. Another important indicator: the value of assets of the enterprise increased from 1.5 to 2.5 billion hryvnias. As a result, the state set up received an enterprise for privatisation that could be expected to be sold for a fairly substantial amount.
Khmelnytskoblenergo also provided the highest projected amount of dividend payments among state regional power companies - more than UAH 30 million, while the closest peer on this scale, taking 2nd place in the dividend ranking table, is Mykolaivoblenergo at only 10.7 million UAH. 3rd place Zaporizhzhyaoblenergo expects to pay a dividend to the state of only 202 thousand UAH. In other words, under Kozachuk, Khmelnytskoblenergo fills the state treasury in an unmatched way.
In addition, Khmelnytskoblenergo, unlike many other players in the energy market, was one of the first energy supply companies in Ukraine which fully paid their accounts with Energorynok for the energy used. This is despite the fact that the total debts of energy networks in the country to this structure amounts to more than 20 billion hryvnias.
Given the fact that now Ukraine (like all countries) will come out of quarantine economically weakened, the actions of the SPF in relation to the leadership of Khmelnytskoblenergo (not to mention the illegality of actions) seem extremely short-sighted. And in fact these actions are contrary to the state interests of Ukraine.
According to experts, the SPF leadership has long been playing along with the country's biggest oligarchs. The aforementioned Deputy Head of the SPF, Serhiy Ignatovsky, previously worked in the legal department of oligarch-controlled Metinvest, and today he is responsible for (at least in theory that is what he is responsible for) managing the assets held by the SPF. It seems that by knocking out the old management, the current management of the State Property Fund want to pull off the "deal of the century" by giving Khmelnytskoblenergo to oligarchis ownership for next to nothing. But for this you need to perform a reset at the company, and therefore, you need to change management. Because it is clear that the old management, led by Kozachuk, would obviously not allow this to happen.
Ivan Sergienko
