Tag Archives: Kazakhstan

Rakishev takes KazKom stake

MARCH 3 2015 (The Conway Bulletin) – Kenes Rakishev, a 35-year-old Kazakh businessman who is the son-in-law of the country’s defence minister Imangali Tasmagambetov, became a major shareholder in Kazkommertsbank, one of Kazakhstan’s biggest and most prominent banks.

Last year, in a deal with Kazkommertsbank, Mr Rakishev bought debt-ridden BTA Bank from the government.

Now he has swapped his stake in BTA Bank for a 16% stake in Kazkommertsbank. The manoeuvre is part of the merger of the two banks.

It also dilutes Nurzhan Subkhanberdin’s ownership of Kazkommertsbank. Mr Subkhanberdin is based mainly in London and has previously been linked to Kazakhstan’s opposition.
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(News report from Issue No. 221, published on March 4 2015)

Max Petroleum suspends trading on AIM

MARCH 2 2015 (The Conway Bulletin) – The collapse in oil prices forced Max Petroleum, a British-Kazakh oil and gas company, to suspend trading on the London AIM stock exchange.

In a statement, Max Petroleum said it was in negotiations to restructure its debt with Sberbank and other creditors.

“If current negotiations are unsuccessful, or if other events outside the control of the Company require that the Company ceases trading while such negotiations are ongoing, then the consequences will be negative for all stakeholders in the Company,” the company statement said.

Last month Max Petroleum squarely blamed the slump in global oil prices for its problems which wiped out profit margins and deterred potential investors.

The Max Petroleum’s troubles are a microcosm of the problems facing Kazakhstan-orientated companies trying to weather an economic downturn linked to the oil price drop and the turmoil in Russia’s sanction-hit economy.

Almaty-based confectionery plant Rakhat, which South Korea’s LOTTE bought in 2013/2014 in a multi-million dollar deal, also said that it had had to lay off 500 of its 3,800 workers. It blamed unfair competition from cheaper Russian sweets.

Once feted as one of Kazakhstan’s most famous companies outside the extractive industries, Rakhat is now trying to eke its way out of the economic storm — just like most other Kazakh companies.

Max Petroleum, listed on the LSE since 2005, is a small Kazakhstan oil producer with an output of around 200,000 tonnes of oil a year.

In August 2014, AGR Energy, linked to the prominent Assaubayev family, made a deal to buy 51% of Max Petroleum for £37m ($62m), promising to embark on a significant investment to revitalise the company. The slump in oil prices, though, appears to have deterred AGR Energy from follow through with the deal and the promised investment.
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(News report from Issue No. 221, published on March 4 2015)

Samruk-Kazyna to refinance debt

FEB. 20 2015 (The Conway Bulletin) — The growing financial crisis in Kazakhstan has now hit the country’s sovereign wealth fund, Samruk-Kazyna.

Umirzak Shukeyev, head of the fund, said the plan was to look to borrow up to $2.5b to refinance its debt.

“If conditions on external markets are attractive enough for us, we will tap foreign markets, although right now we see that the situation in the internal market is more favourable for us to borrow,” he said.

Regardless, Samruk-Kazyna’s insistence that it will need to borrow cash to restructure its debts is an important admission that the financial crisis is growing.

Like its neighbours, the slowdown in Russia’s sanction-hit economy and the drop in the price of oil has hit Kazakhstan hard.

Samruk-Kazyna holds about $100b in assets, roughly half Kazakhstan’s GDP, and manages about 500 companies.

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(News report from Issue No. 220, published on Feb. 25 2015)

Support increases for early election in Kazakhstan

FEB. 21 2015 (The Conway Bulletin) — Various political organisations in Kazakhstan threw their support behind the prospect of an early presidential election, virtually ensuring the vote goes ahead in the next couple of months. Kazakh officials floated the idea earlier this month. They want President Nursultan Nazarbayev’s authority underlined.
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(News report from Issue No. 220, published on Feb. 25 2015)

Nazarbayev opponent dies in jail

>>Former son-in-law alleged to have committed suicide>>

FEB. 24 2015 (The Conway Bulletin) — Rakhat Aliyev, an opponent and former son-in-law of Kazakh President Nursultan Nazarbayev, died in prison days before the end of a pre-trial hearing linked to the 2007 murders of two Kazakh bankers.

He was found hanged in the toilet, the only corner of his solitary cell without constant surveillance. The prison administration described his death as a suicide but Aliyev’s lawyer, Klaus Ainedter, cast immediate doubt on this explanation.

“I have significant doubts about this without wanting to blame anyone. I visited him yesterday. There could be no talk whatsoever of danger of suicide,” Mr Ainedter told the local press.

Aliyev had at one time been viewed as a potential successor to Mr Nazarbayev but he fell from grace in 2007 and was forced to flee Kazakhstan before the authorities could arrest him for the murder of the two bankers.

In exile, Aliyev, who had been married to Mr Nazarbayev’s eldest daughter, set himself up as a vocal opponent of his former father-in-law from his bases in Malta and Vienna. He always denied any link to the bankers’ murders.

Last year, Aliyev turned himself in to the authorities in Vienna days before police planned to arrest him. The Austrian authorities had declined to deport Aliyev back to Kazakhstan but they had agreed to try him in Vienna for the murders.

Aliyev’s death rids Mr Nazarbayev of another major opponent. In 2013, French police arrested Mukhtar Ablyazov, a former Kazakh banker and minister, who was also a high profile opponent of Mr Nazarbayev.
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(News report from Issue No. 220, published on Feb. 25 2015)

Kazakhstan-US law deal

FEB. 20 2015 (The Conway Bulletin) — Kazakhstan and the US have signed an agreement that will smooth law enforcement issues between the two countries, the US State Department said. In particular the deal, which the US State Department described as an “important step forward”, will help the transfer of evidence between the two countries.
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(News report from Issue No. 220, published on Feb. 25 2015)

Delay for Almaty metro

FEB. 18 2015 (The Conway Bulletin) — Kazakh president Nursultan Nazarbayev ordered work on the Almaty Metro system to stop because of a shortage of funds, media reported. The first phase of Almaty’s metro was unveiled in 2011 but high costs and low passenger numbers have combined with a drop in government funds to delay a planned extension.
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(News report from Issue No. 220, published on Feb. 25 2015)

Industrial output in Kazakhstan drops

FEB. 19 2015 (The Conway Bulletin) — Industrial activity in Kazakhstan will decline by 0.3% this year to its worst level in 17 years, media reported quoting the economy ministry. The drop in industrial activity is symptomatic of the overall slowdown in Kazakhstan’s economy in the past 12 months.
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(News report from Issue No. 220, published on Feb. 25 2015)

Two men jailed in Kazakhstan for IS link

FEB. 20 2015 (The Conway Bulletin) — A court in the central Kazakh town of Temirtau sentenced two men to eight and 11 years in prison for links to radical Islam and plotting a series of attacks. One of the men, prosecutors said, tried to recruit people to head out to join the extremist IS group in Syria.
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(News report from Issue No. 220, published on Feb. 25 2015)

Gradual devaluation for tenge

FEB. 11 2015 (The Conway Bulletin) — Kairat Kelimbetov, head of the Kazakh Central Bank, hinted for the first time that he was prepared to allow a gradual devaluation of the tenge. He told Russian media: “We will not allow a one-off shock devaluation and instead will work within the framework of a smooth and flexible exchange rate mechanism.”
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(News report from Issue No. 219, published on Feb. 18 2015)