Yevgeny Dod recently had an interview with the Russia 24 television channel. During this interview, he said that by the year 2016 or 2017, RusHydro will be completely ready for privatization.

In his interview, RusHydro’s Yevgeny Dod said that the company’s current management team believes that the state should have control over its operations. However, Dod went on to say that he was interested in getting the company privatized and wanted a strategic investor as a partner. As a vehicle for privatization, the company could go through an IPO, an SPO, or even conduct an asset swap. In the end, RusHydro wants to find a partner and a strategic investor. Achieving this aim would provide more transparency to other investors, as well as the state. Moreover, if a strategic investor was brought on board, many aspects of the company’s operations could be improved, such as project planning, execution, and design.

Dod informed Russia 24 television that after either 2016 or 2017, the company would be ready for an auction within an affordable pricing range. He went on to clarify that although the company was technically ready for it now, there were two issues that created obstacles: the company’s value and liquidity.

Currently, the state has ownership of 67.5 percent of the company’s stock and also holds a two-percent share as treasury stock. If RusHydro were to be privatized, the state’s share would be reduced to 51 percent. Government officials are still considering this scenario and the final figures are yet to be decided. If the privatization took place today, RusHydro would probably sell off a 16.5-percent stake, but this can only be done if the government reduced its stake to one allowing for bare control, permitting a strategic investor to take charge.

Dod emphasized to the media that the company was interested in strategic investors more than in anything else, and had plenty of details to share in this regard. He said that RusHydro had plans to conduct a thorough search. Once an investor was chosen, 51 percent of the shares would be kept with the state, while the remaining 49 percent would be privatized in a single transaction. He once again repeated that an IPO model could also be selected, but a strategic investor seemed to be a more interesting option because of the advantages that would come with it.

The news of RusHydro’s search for an investor has already reached far and wide. People and companies based in several countries, including China, the United States, Canada, and the European nations were all intrigued by the announcement.

In line with future predictions, the company’s market value would be the greatest in the year 2017 because all hydro stations now under construction will have already been completed by that time. After all ongoing construction projects are completed, the company will achieve its maximum price, provided that external factors remain within acceptable ranges. At the start of 2017, the company will step into a new era. Profits are expected to be huge, and RusHydro would have to spend minimum funds for maintenance and upgrades.

Yevgeny Dod also indicated that a change in the years to come actually affects today’s forecasts. As long as the market rules are not changed, all would be good.

When asked about the future management team, Dod stated that the total number of executives may be reduced. This step would help the company achieve optimization in its managerial structure. Dod also clarified that the overall number of employees in management positions will not decrease.

Yevgeny Dod also gave reasons for the need to modify the management structure. He said that it was important that this step be taken so that the structure of the entire company could be changed. Dod believed that modifying the management model was important because the company was growing and needed to handle a growing number of large projects, ranging from new construction to repairs. As such, RusHydro had to adapt, which could only be done if the company’s managerial hierarchy got optimized.

Currently, RusHydro is facing a number of challenges in improving its structure of management. The company is interested in reducing the amount of money spent on maintaining its executive body by at least 20 percent to 25 percent. The upper echelons of the organization are ordinarily accountable for the greatest costs and often take up the largest percentage share of the budget. Dod made it very clear that for him it was better to terminate one member of the management board than 10 other employees farther down the line.

The management board of RusHydro is comprised of 14 members. Five of these are deputy chairmen. The state-controlled division of the company has ownership of most of Russia’s hydro plants. It also controls the RAO energy system in some regions and also supervises electric rail assets. The overall installed capacity of RusHydro’s plants is 36,500 megawatts.