Consortium "Merrill Lynch-Raiffeisen investment" suggested to Government that ownership transformation of NIS should be carried out in three phases

Although it is still unknown when the public will see the report made by privatization councillor for Petroleum Industry of Serbia, according to unofficial information, the consortium"Merrill Lynch-Raiffeisen investment" suggested to the Government of Serbia that the ownership transformation of NIS (Petroleum Industry of Serbia) should be carried out in three phases.

According to that suggestion, first, 33-40% of stocks would be sold to the foreign strategic partner, and then another package oif stocks would be sold prior to the year 2010, which would be enough for the buyer to take over ownership over NIS from the Government of Serbia. As soon as Serbia joins European Union, the State should sell the remaining share of stocks of the company.

The State and strategic partner obliged to invest 840m CSD into NIS prior to 2010 - the buyer will invest 200 - 400m EUR, whereas the rest of tha amount would be provided from the incomes of Petroleum Industry of Serbia.

It is known from before that prevailing opinion in the Government of Serbia is that NIS should first be modernized and then privatized. Such suggestion exists in the report of consortium "Merrill Lynch-Raiffeisen investment". Also, the biggest number of Serbian ministers are of the opinion that the minority package of stocks of the national oil company should be sold.

The management of NIS can be satisfied with the fact that the proposal of the privatization councillor contains no institution of "golden" stock, which would make it possible for the minority strategic partner to influence investment plans. The proposal of the privatization councillor does not imply partial sale of parts of NIS, let's say refineries, which suits republic government in which the general opinion is that Serbia needs new credit arrangement with the International Monetary Fund, with which it used to sign the agreement on obligatory sale of Serbian refineries.

Consortium "Merrill Lynch-Raiffeisen investment" estimates that NIS is worth about 2 billion USD and it expects that 50-700m EUR from the privatization of the national oil company will enter State's treasury. The workers and citizens should get up to 30% of stocks during the realization of the first phase of privatization.

The privatization councillor suggests that it should be made possible for strategic partner to buy the rest of the stocks of the company on the stock exchange three years later.