Samruk-Kazyna: shares of national companies available to public in Kazakhstan
By E. Kosolapova, D. Mukhtarov
There are all the conditions for availability of national companies’ shares to the general public in the frame of People’s IPO in Kazakhstan, Sovereign Wealth Fund Samruk-Kazyna told Trend via e-mail.
“The head of the state, initiating the program, ordered to make the national companies’ shares available to the general public. The Fund together with the Government of the Republic of Kazakhstan has taken all necessary measures,” Sovereign Wealth Fund Samruk-Kazyna said.
The Fund noted that the emphasis was placed on improving financial literacy of citizens, in order to minimize risks and make people’s participation in the program realized.
The second important step towards ensuring the availability of the shares was “cheapening” of securities for retail investors.
“Split of JSC KazTransOil’s shares was carried out in late June – their number increased by more than 10 times. Their price decreased by 10 times. And, as you know, it is 725 tenge (150.46 tenge = $1)” the statement said.
In addition, steps were taken to create the possibility of submitting bids to purchase the shares.
“The stock market is subject to certain rules, and an investor can not just go and buy shares. All the procedures are carried out through intermediaries, professional participants of the securities market, ie brokers. It is licensed activity. Mostly, brokers are located in Almaty. We prepared the necessary infrastructure based on the branch network of JSC Kazpost in this regard. It also applies to the district, and to rural branches of Kazpost,” the Fund said.
A Memorandum of Understanding between the fund and concerned brokerage companies was signed on August 29, 2012 to reduce the cost of retail investors.
The memorandum provides a reduction in the commission for brokerage services to individuals to purchase shares at the time of the initial public offering in the frame of the program People’s IPO, as well as their subsequent sale on securities market.
“The commission of brokerage companies for each such transaction will not exceed 1 500 tenge for transactions worth less than 200,000 tenge,” the statement said.
In addition, according to Samruk Kazyna’s report, certain restrictions were adopted for the sale of shares.
“Placing of KazTransOil’s shares will be carried out by creating book of applications, which were submitted by all interested citizens of the country within a month. The requests of retail investors for shares will be accepted within the limits of seven million tenge,” the statement said.
According to Samruk Kazyna, the companies presented in the People’s IPO programme, passed a rigorous selection.
“High demands were made on corporate governance, transparency, state assets, growth prospects during selection of the companies for ‘People’s IPO’ programme.. Based on these parameters, only 10 companies out of 400 were selected for participation in the programme,” the statement said.
Selection of KazTransOil as the first participant in the programme was not random.
“During the research, KazTransOil proved itself as the most stable and successful company based on factors such as dependence on prices on world commodity markets, level of corporate governance and effectiveness of financial and economic activities,” the statement said.
According to the results KazTransOil’s share placement and high interest in the shares of the company, observed both among the population, and among professional participants of the financial market, represented by pension funds, the choice of KazTransOil as the first participant of the programme paid its way.
The ‘People’s IPO’ programme will allow the Kazakh citizens to become co-owners of the nation’s largest companies. The implementation of programme is scheduled for 2012 – 2015 .