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Serbia faces potential €1.5 billion cost for majority stake purchase in NIS to avoid sanctions

According to Nenad Gujanicic, head broker at Momentum, acquiring a majority stake in the Serbian oil company NIS from Russian entities could cost Serbia up to €1.5 billion. This move is seen as a potential strategy to help Serbia avoid sanctions from the US.

Gujanicic explained that NIS’s market value has dropped by about 10% in just two days, falling below €1 billion based on share prices on the Belgrade Stock Exchange. Over the past few years, NIS’s market value has ranged between €1 billion and €1.3 billion. However, he pointed out that the Belgrade Stock Exchange is highly illiquid, with minimal trading activity. If a tender for NIS’s sale is initiated, its price could rise to between €2.5 billion and €3 billion, or even higher if strong competition arises.

As of 2022, NIS’s ownership structure includes GazpromNeft with a 50% stake, the Serbian state with 29.87%, Gazprom with 6.15%, and OTP Bank’s custody account as the largest minority shareholder with 1.61%. The remaining shares are divided among smaller shareholders, including Serbian citizens who own a few shares each.

Recently, Serbian President Aleksandar Vucic suggested that NIS could face sanctions due to its Russian ownership. He mentioned that, starting from January 1, 2025, the US and UK might impose sanctions by restricting crude oil transportation through the JANAF pipeline from Croatia’s Port of Omisalj to NIS’s refineries in Novi Sad and Pancevo. US Ambassador to Belgrade, Christopher Hill, did not confirm or deny the potential sanctions but acknowledged that the risk has been looming for some time.

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