The price issue and the validity of the deal is now to be taken to court by the highest bidder, the Nortima company associated with one of the Ukraine’s tycoons, Ihor Kolomoisky. The managers of Mr Kolomoisky believe that their rights as a buyer were violated. However, most of the experts believe that the State Property Fund of Ukraine had the ultimate right to validate or refuse the winner of the tender given the economic circumstances of the privatization deal for Odess Port-side Plant.

While the government scheduled the tender for September 29,  President of Ukraine Viktor Yushchenko raised objections. On September 17 he suspended the government resolution No 1517-r of December 3, 2008, which basically halted the privatization of the Odessa port-side plant.

Several bidders for Odessa Port-side Plant canceled their participation as a result of the President’s Decree. A consortium of Norway’s Yara, Polish Kulczyk Holding and Libyan LIA who had announced the intention on September 14 to take part in the privatization tender to buy Odessa port-side plant, eventually did not participate.

The three participants who remained, Azot Servis (Russia, associated with Gazprom), Frunze-Flora (Ukraine) and Nortima (Ukraine) had a different interpretation of the Presidential Decree and made a decision to continue their pursuit of Odessa Port-side Plant.

While Nortima is going to get itself busy with legal actions, the Cabinet of Ministers of Ukraine is now planning to hold a new tender for Odessa Port-side Plant next year following the Presidential elections to be held on January 17, 2010.

But just as her government adopted conditions on Jan. 30 for the Odesa Portside auction, which experts said could fetch as much as $1 billion, President Viktor Yushchenko played a political gambit, in the view of experts, and criticized the sale??™s handling. Last week, the Presidential Secretariat criticized the Odesa Portside sale terms because they could allegedly allow the Ukrainian government to break agreements with the investor and unilaterally re-nationalize the plant, all without a court ruling. (Which is no more than a speculation since the constitutional legal procedures are not subject to any governmental decrees).

State Property Fund officials, responsible for organizing auctions, said the sale of a 99.57 percent stake in Odesa Portside is still scheduled to begin this month, with opening bids between $500 and $700 million.

The privatization of Ukrtelecom, which could raise another $1 billion, is expected to commence later this year.

The Odesa Portside sale is expected to be the most expensive since the $4.8 billion auction of steel mill Kryvorizhstal in 2005.

Strategically located at the Black Sea, the port is supplied with raw materials by pipeline, giving it competitive advantages over other chemical plants in Ukraine. Odesa Portside is Ukraine’s leading producer of nitrogen fertilizer and ammonia.