Ukraine's Embattled Tycoon Wants Settlement

KIEV, Ukraine -- The son in-law of former president Leonid Kuchma urged the government Friday to reach a settlement with business magnates over the dubious privatizations of the country's biggest steel producers.

Embattled tycoon Viktor Pinchuk appealed to President Viktor Yushchenko to bargain, arguing that investors are rattled by the new leader's pledge to undo deals that put state property in the hands of people close to the previous regime. Pinchuk's valuable steel assets are among the businesses being investigated.


Pynchuk (r) shown with President Bush Sr. in 2004
"There have been some enterprises -- problematic or not -- and we should finish with the re-privatization issue because it is unsettling, it reduces investments, it causes economic damage to the country," Pinchuk said in a telephone interview with The Associated Press.

Pinchuk flew with his associates to the Nikopol Ferroalloy factory on Thursday to stop what they said was a hostile takeover attempt by Privat Bank and its alleged allies in the government's State Property Fund. The move came during a shareholders' meeting to which he and the board of directors had not been invited.

While hundreds of factory workers loyal to Pinchuk barricaded themselves in the plant, Pinchuk met with Prime Minister Yulia Tymoshenko for two hours.

"We discussed relations between the business and the government and about the need to find compromise, to cooperate for the benefit of the country," Pinchuk said.

He said they discussed "a possible bill, more precisely a law that would solve this (privatization) problem once and for all."

Tymoshenko's aides declined to comment. Officials from the bank and the State Property Fund were not available.

The Nikopol Ferroalloy plant is owned by Interpipe Corp., the largest steel corporation that produces pipes for gas and oil pipelines in Ukraine. It was sold to Pinchuk during Kuchma's term in office.

Yushchenko's allies have suggested its privatization was suspicious and prosecutors are investigating.

Source: Business Week