YUKOS Is No Longer Bankrupt
The sale of the central office of YUKOS in Moscow, scheduled for today, will conclude the bankruptcy of the oil company. The high-rise office building on Dubininskaya St. is the last high-value lot and even its starting price will cover the sum necessary to make current payments and satisfy creditors. Formally, that means that the company's bankruptcy case should be closed. Nonetheless, Group MENATEP is unlikely to receive even the leftover money from YUKOS.
Today's auction of Lot 13, which includes the Moscow office of YUKOS, will fill the bankruptcy asset coffers by at least another 22 billion rubles (the starting price of the lot). There are creditor demands for 709 billion rubles registered. The sale of this property will bring proceeds to 713 billion rubles.
The remaining YUKOS property to be put on the block is estimated to be worth 9 billion rubles. One more significant asset, the Slovakian Transpetrol, is not yet slated for sale. It is estimated to be worth $100 million. The problem with the sale of Kuban electric facilities to Promregion Holding, which did not receive permission from the Federal Antimonopoly Service for the deal, is insubstantial with 4.9 billion rubles at stake. Nikolay Lashkevich, press secretary for YUKOS bankruptcy manager Eduard Rebgun, said that there was no established procedure to cover the situation and the creditors committee must now decide whether to hold a new auction or declare Rosneft, which had the second highest bid, the winner.
Thus the bankruptcy assets from the sale of YUKOS property, even leaving the remaining assets and the disputed Kuban sale aside, will exceed the creditor demands list in the register by more than 20 billion rubles after today's auction. Under bankruptcy law, Rebgun should prepare an account after settling with creditors and present it to an arbitration court for examination. The law gives the court the option of completing bankruptcy proceedings, liquidating the company or closing the case. The court must close the case if the bankruptcy manager has all creditor demands list on the register. In YUKOS case, that is 709 billion rubles.
Lashkevich “assumed with confidence” yesterday that, as a result of the auctions, all debts would be satisfied. The money remaining after creditor demand are met will be put on the YUKOS current expense account, Lashkevich said. He was unable to specify the amount of YUKOS current payments.
Whether or not the company will be bankrupt depends on the current payments, however. “It is necessary to consider the expenses for the liquidation procedure, current payments associated with the debtor company's activities during the bankruptcy period and payments and possible commissions for the auctioneer,” said Alexander Kolesnikov, bankruptcy manager at Promeximbank. The law on bankruptcy considers those expenses preferential and requires that they be paid from the bankruptcy assets ahead of the creditors.
Rebgun is receiving compensation of 1.8 million rubles per month under a August 1 decision last year by the Moscow arbitration that declared YUKOS bankrupt. The amount of the other payments is unknown. The law does not impose limits on them.
If the sum of current payments and creditor demands is less than the bankruptcy assets, the law allows the creditors committee to make the decision to bring in outside management to reestablish the company's solvency. The law requires the bankruptcy manager to call a meeting of the creditors committee with a month of when he becomes aware of the possible issue. Another option provided by the Civil Code and law on joint-stock societies is to proceed from the bankruptcy to the liquidation of the company, in which case the remaining funds are distributed among its stockholders. In YUKOS case, that is the disfavored Group MENATEP.
Instead of the closing of the YUKOS bankruptcy case, the stockholders can probably expect the remaining funds to go to taxes. Those are tax claims arising since bankruptcy proceedings began as well as VAT on the amount of proceedings from the sale of company property, which s to be paid after the creditors' claims are satisfied. That procedure was established by the plenum of the Supreme Arbitration Court on June 22 of last year.
Olga Pleshanova, Denis Rebrov
All the Article in Russian as of May 11, 2007
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