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This paper begins from the proposition that ‘deep restructuring’ requires both finance and managerial expertise. It addresses the question of how this second stage of enterprise restructuring will come about in the majority of state‐owned or former state‐owned firms that are not owned by foreigners. In particular, it seeks to identify how the initial post‐privatization ownership and control structure impinges on the likelihood that deep restructuring takes place. Conclusions for the design of privatization policy are drawn. The initial post‐privatization ownership structures in the Visegrad countries and Russia are surveyed along with evidence of the transfer of ownership from insiders to outsiders.