Merger of YUKOS and Sibneft to save the new company at least USD 200 million in 2004

Specialists believe the merger of YUKOS and Sibneft will save the new company at least USD 200 million in 2004. As a Rosbalt correspondent reports, this was announced yesterday by President of YUKOS EP Yuri Beilin. He said that similar mergers abroad suggest the company might save up to USD 500 million. A saving of USD 200 million is considered the minimum, Mr Beilin said.

YUKOS CEO Mikhail Khodorkovsky does not believe the companies' integration will bring losses to the merged company. 'I think we will be able to draw up a joint plan on investments and restrict operational costs, despite the expected rise in tariffs on natural monopolies next year,' he said. Mr Khodorkovsky said that joint management of the merged company will begin on January 1, 2004.

According to YUKOS Vice-President for Strategic Planning Yuri Kalner, a proposal on how to organise the joint management of the company has already been agreed upon. 'Until January 1, 2004, we will be busy assessing and trying to align the business processes of both companies so that there are no surprises in the area of sales and investment after January 1,' he explained. He said the unification process will continue after January 1 although it will then only involve less urgent issues such as logistics and the supply of machinery and equipment.

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