Professor Dragan Djuricin from the Faculty of Economics in Belgrade criticized the 2008 privatization of Serbia’s oil company NIS, calling it a significant undervaluation of one of the country’s most strategic assets.
Djuricin noted that Deloitte, hired by the Serbian government to assess NIS’s value, estimated the company at €2.2 billion for full ownership, excluding mineral resources. Despite this, a controlling stake of 50% plus one share was sold for approximately €420 million—less than a fifth of Deloitte’s valuation. He added that the sale was conducted without formal coordination between the seller’s and buyer’s valuation teams, a standard practice in transactions of this scale.
The privatization agreement included commitments for large future investments and the construction of the South Stream gas pipeline, neither of which were realized. Following the sale, the Russian partner extracted substantial volumes of Serbia’s natural resources while paying royalties far below regional norms. This exploitation, combined with operational improvements, generated record profits, with NIS reporting net earnings of €1 billion in 2018. Serbia’s 30% state stake contributed €300 million to the national budget that year.
At the time of privatization, the government distributed part of its remaining stake to citizens as free shares. Over time, many sold their holdings, reducing the state’s ownership from 49% to around 30%. Before privatization, NIS had been poorly managed, often operating at a loss due to political interference and mandatory funding of public spending, leaving little room for efficiency. Under GazpromNeft’s control, the company became highly profitable through better resource management and technological upgrades.
Djuricin emphasized that while Deloitte’s valuation was accurate and officially mandated, political decisions at the final stage undermined the process. According to him, members of Serbia’s political leadership replaced the Ministry of Economy with a new intermediary to handle negotiations with the Russian side. He also suggested that Western oil and gas companies deliberately avoided participating, potentially as part of a geopolitical strategy to leave Serbia’s energy sector within Russia’s sphere of influence.
He concluded that had Serbia retained its 49% stake, regaining majority domestic control of NIS would be a far more feasible goal today.
