Russia to sell part of its stake in shipping group Sovcomflot to raise funds for stretched budget

MOSCOW, Nov 3 (Reuters) - Russia plans to sell a 7.8% stake in state-controlled shipping giant Sovcomflot as it seeks additional sources to cover its budget deficit in the fifth year of the war in Ukraine.

The state property fund said on Tuesday it has begun a selection process to organise the sale of 7.8%, minus one share, in the company. Applicants will be required to submit a report on "possible deal structures that would maximise cash proceeds to the federal budget".

Russia currently holds 82.8% of Sovcomflot, having sold 17.2% through an initial public offering in 2020.

The additional sale would leave the state with 75% plus one share of the strategically important company, which plays a key role in exporting Russian oil and gas, including LNG shipments from Arctic projects.

By selling the stake Russia could raise about 15 billion roubles ($183.78 million), based on the company's current share price on the Moscow Exchange.

In the fifth year of the Ukraine conflict, Russia is seeking additional sources of budget revenue on top of tax rises it has already introduced, to cope with rising military spending.

According to Finance Ministry estimates, the budget deficit is expected to more than double from the initial plan this year, to 3.2% of GDP.

In addition to Sovcomflot, Russia is also planning to sell a 20% stake in Novorossiysk Commercial Sea Port (NMTP) and a 23.8% stake in flag carrier Aeroflot.

($1 = 81.6200 roubles)

(Reporting by Gleb Stolyarov; Editing by Mark Trevelyan)