The Cyprus Stock Exchange (CSE) is inching closer to privatization, with the process slated to conclude no later than the end of 2024, according to a draft law prepared by the Ministry of Finance.
The proposed legislation outlines the next steps for the privatization of the CSE, the Central Depository, and the Central Securities Registry through a specific competitive selection process for a strategic investor.
According to the draft law, the privatization process, involving the assessment and selection of the successful strategic investor by the Republic, will follow a competition of expressions of interest and bids from interested potential strategic investors.
Any share capital or shares held by the Republic, post-privatization, in a company, depending on the case, will be considered fully paid and settled, as if it were discharged in kind by the Republic, and will be accounted for as issued and transferred to the Republic against consideration equal to the nominal value.
The privatization process will commence following a decree or decision by the Council of Ministers published in the Official Gazette of the Republic.
Simultaneously, the draft law abolishes existing stock market legislation and terminates the powers of the CSE Council.
It also includes provisions for the transfer of the tasks, responsibilities, activities, and functions of the CSE to a private special purpose vehicle of the assets and liabilities of the CSE and to a private special purpose vehicle for indefinite-time employees and workers at the Ministry of Finance.
The Ministry of Finance has opened the draft law for public consultation, and interested parties are invited to submit their opinions by January 15, 2024.
According to the Ministry of Finance, securing a strategic investor for the CSE is a milestone for the Recovery and Resilience Plan for Cyprus under the section “Enhancing Business Competitiveness,” with a completion timeline for privatization by the end of 2024.