Ukrainian oligarch calls for nationalization of industrial assets

One of Ukraine's most powerful oligarchs has called for the nationalization of some of the country's high-value industrial assets, arguing that their privatization was a criminal conspiracy. Ihor Kolomoisky, a billionaire businessman, said that Ukraine should not receive any new funds from the International Monetary Fund until all "illegally" privatized property is restored to state ownership.

Kolomoisky said that "Ukraine is forced to ask for money, and this money ... Return the enterprises, put them up for sale in an open tender, and you will receive 10 times more than before," adding that any new auctions could raise tens of billions dollars. Ukraine secured a $ 17.5 billion bailout package from the IMF, and last week began negotiations to restructure $ 15 billion in debt.

Kolomoisky's proposal poses a direct challenge to other oligarchs who scooped up state assets in the privatization of the 2000s. Critics say his motives may have to do with a desire to gain an edge over his competitors in the hectic atmosphere of post-revolutionary Ukraine. But new privatizations could raise concerns about the sanctity of property rights in Ukraine and destabilize an already fragile business climate, experts warn, as the country struggles to cope with a deep economic crisis and war in eastern Ukraine. Arseniy Yatsenyuk, Ukraine's prime minister, reacted cautiously to Kolomoisky's proposal, telling the Financial Times that he could "open a Pandora's box."

Igor Kolomoisky and his partner Gennady Bogolyubov manage their assets through a network of offshore legal entities. Interests include banking, energy, petrochemical and mining. Kolomoisky's appeal came against a backdrop of growing divisions among Ukrainian oligarchs. Most significant is the multibillion-dollar legal battle in the London High Court of Mr Kolomoisky against Viktor Pinchuk, a rival oligarch and son-in-law of Leonid Kuchma, the former president of Ukraine. Both are fighting for ownership of a Ukrainian iron ore mine, KZhRK, part of a state-owned conglomerate known as Ukrrudprom, which could set a precedent for further asset disputes.