KEGOC to offer 5% of its shares during SPO

During its secondary public offering (SPO) KEGOC, a subsidiary of the Samruk Kazyna holding, is planning to offer 5% of its shares. The SPO is going to happen by the end of this year, according to the press service of the prime minister.

«We are going to continue moving entities from the quasi-state sector into a competitional environment or reorganize them. By the end of this year, we are expecting the SPO of 5% shares of KEGOC, followed by IPOs of Air Astana in 2024, QazaqGaz, Kazakhstan Railways and Samruk Energy in 2025,» the prime minister’s office said in a statement.

The office also noted that bids from Kazakhstanis always take top priority when it comes to so-called People’s IPOs. This practice was tested during the IPO of KazMunayGas (a subsidiary of Samruk Kazyna). As of July 1, 2023, Samruk Kazyna controlled 90% of KEGOC, which went on the People’s IPO in 2014. Another 7.25% of the company’s shares are controlled by the United Accumulative Pension Fund and the remaining 2.5% belong to minority stakeholders.

In an address to the nation delivered on September 1, President Kassym-Jomart Tokayev said that the state is going to conduct a People’s IPO of Air Astana in 2024, while QazaqGaz should be prepared for an IPO.

«Our purpose is to make asset management as transparent and efficient as possible. I am ordering the cabinet to launch the privatization of non-core assets and to organize the People’s IPO of companies run by the Samruk Kazyna holding starting from 2024. Air Astana should go public next year, while QazaqGas should be prepared for an IPO as well. We have to sell public assets in big companies,» he said during a joint meeting of the two houses of parliament.

As Tokayev noted, Kazakhstan is creating an open economy, which is why all recovered assets must be sold in the market. Under the program of the People’s IPO KazTransOil and KEGOC sold 10% of their share minus one ordinary share in 2012 and 2014, respectively.

At the time, the government planned to offer shares of other Samruk Kazyna companies as well. However, this program was dropped ahead of schedule. Under this program, Kazakhstanis were supposed to have priority in buying these shares. Entities and the pension fund were allowed to buy shares on a second-priority basis.