YUKOS HQ Goes Back on the Block
// Rosneft wants to buy it from Prana
Rosneft may still move into YUKOS headquarters. The state oil company reported that negotiations have begun with the new owners of the building, the mysterious OOO Prana. Moreover, Rosneft is willing to buy the other assets sold in the same lot as the building for 100 billion rubles. If Rosneft gets a serious discount, it will be obvious that the results of the auction were not related to the market value of the assets. The difference from the starting price (22 billion rubles) corresponds to the sum of YUKOS claims against companies belonging to Roman Abramovich, whose involvement in the transaction was reported by Kommersant sources. After Prana's victory, the sides began to discuss a settlement.
Rosneft president Sergey Bogdanchikov announced yesterday that the company had begun negotiations with Prana on the acquisition of YUKOS assets that were auctioned off in lot 13 at the beginning of May. “We are holding negotiations with the owners or executives of Prana. To tell the truth, we are not especially interested in who they are, and we intend to acquire a significant part of the assets [of YUKOS, purchased by Prana],” Interfax news agency quotes Bogdanchikov as saying. He emphasized that it was a matter of buying YUKOS assets, not assets of Prana itself.
At Rosneft, they declined to say exactly what assets were of interest. A Kommersant source at YUKOS said that the purchase of the company's former headquarters on Dubininskaya St. in Moscow is under discussion. Bogdanchikov said that, besides the building, several thousand railway tanker cars, money in the sum of several hundred million dollars, unreturned VAT in approximately the same volume and several hundred thousand tons of petroleum products. “Just the YUKOS-M trading house comes in at over $1 billion, plus the filling stations in Moscow and Moscow Region,” Bogdanchikov said. Prana representatives refuse to talk to the press, so Bogdanichikov's words could not be confirmed with them.
The Rosneft president did not say what sum would be offered in the deal, but he confirmed that it would include “a profit within the limits accepted in the company.” Rosneft bid up to 100 billion rubles in the auction for lot 13. Experts were amazed at the outcome of that auction, which inexplicably totaled 100.09 billion rubles ($3.9 billion) after starting at 22 billion rubles.
Research by Kommersant published on May 31 suggests that thee may be $2 billion in the accounts of subsidiary companies that were included in the lot. Since the time of the auction, though, another theory has been advanced, that is, that the huge price was paid because that money had to be transferred to YUKOS.
Two weeks ago, a source close to the presidential administration told Kommersant what that could be necessary for. He said that the deal was financed by Russian billionaire, Governor of Chukotka and former owner of Sibneft (now known as Gazprom Neft) Roman Abramovich. According to the source, Abramovich returned to YUKOS the $3 billion that it paid for 20 percent of Sibneft in 2003 as part of the unification of the companies. At the end of 2003, after the beginning of the Russian authorities attack on YUKOS and its stockholders, Abramovich cancelled the deal, which was already in its final stages. Then, hoping for money with which to pay tax demands, YUKOS insisted on a reverse exchange, especially since a mirror deal was required to split the companies up. Sibneft shareholders did not agree to it though. Kommersant's source said that “Roman Abramovich remained in debt, even though YUKOS, along with the Gazprom Neft stock, was subject to expropriation.” Kommersant was unable to confirm those claims. Millhouse Capital, which manages Abramovich's assets, firmly denies any relationship to Prana or the deal to obtain YUKOS assets.
Yesterday Kommersant learned of events that may serve as indirect confirmation of the involvement of Abramovich structures in the sale of lot 13. Sources say that, after the sale of the lot at the end of May, a settlement between YUKOS and several offshore companies that represented the interests of Millhouse Capital. YUKOS filed suit in the London International Arbitration Court in 2004 to demand that Sibneft shareholders buy 20 percent of that company and return $3 billion. In addition, YUKOS insisted that compensation for the failed deal to form YukosSibneft included a provision for the party that rejected the deal to pay $1 billion to the other.
It seems unlikely that YUKOS will receive that money. Kommersant has learned that the agreement being hammered out includes a renouncement of all mutual claims, with YUKOS remaining the owner of Sibneft stock. (In April, it was sold to Gazprom along with other YUKOS assets.) Sibneft shareholders will not return money to the company. Neither YUKOS nor Millhouse Capital would comment on the progress of arbitration proceedings yesterday. If a settlement is reached, and Rosneft is able to buy the main assets from lot 13 significantly more cheaply that for 100.09 billion rubles, the theory of Abramovich's “debt” will receive further confirmation. The fact that Kommersant showed the involvement of structures close to Gazprom in the deal on May 16 and June 13 is not contradictory. They could take part in the settlement as the new owners of Sibneft.
Dmitry Butrin, Olga Pleshanova, Denis Rebrov
All the Article in Russian as of June 26, 2007
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