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03.08.2001
Izvestiya
The long-running argument between the shareholders of oil companies TNK and SIDANCO was resolved in an unexpected manner
Izvestiya (M. Ignatova – “Cutting the Gordian Knot”) notes that the long-running argument between the shareholders of oil companies TNK and SIDANCO has been resolved in an unexpected manner. In order to return SIDANCO’s lost subsidiary and remain in the gas business, Interros decided to sell its stake in SIDANCO to TNK shareholders. At present, TNK is essentially planning to return Chernogorneft to itself, says M. Ignatov. According to Interros Director Dmitry Ushakov, his group of companies exited SIDANCO with a good financial return: “The price that was offered matches our expectations.”
Interros will not dispute the validity of decisions taken at the RUSIA Petroleum’s shareholders meeting. Irkutskenergo will buy back the 7% stake from the shares it has sold from Interros, and sell them to TNK. SIDANCO is to sell its stake in RUSIA (5.62%) in favor of BP, Interros and TNK. According to Renova’s Chairman of the Board of Directors (TNK’s second shareholder) Victor Vekselberg, the field will be developed mostly with borrowed resources. However, Dmitry Ushakov believes that adjustments may yet take place among RUSIA’s owners. Interros intends to develop this project. But, according to Ushakov, “if further participation becomes less advantageous than exiting, then we could potentially sell this as well,” concludes the article.
03.08.2001
Izvestiya
According to NIKoil’s analyst G. Krasovky, the purchase of SIDANCO essentially means that TNK is Russia’s Number three oil company, with an annual output of 50 million tons of oil
Izvestiya (M. Ignatova – “LUKoil and Slavneft – You’re Next”) reports on an announcement by Deputy Minister’s of Property Relations Alexander Braverman, regarding the of the Russian Government’s privatization plans for 2002. Among the oil majors the government decided to limit itself to selling a 19.69% stake in Slavneft. “In the past there had been no actual contenders. Today, the most probable buyer of Slavneft is TNK,” believes NIKoil’s analyst Gennady Krasovky. The only thing left to do is to find out whether TNK will have enough money for the purchase, as it has recently acquired SIDANCO.
03.08.2001
Vedomosti
Interros has exited the oil project with a good financial return
Vedomosti (by Yulia Bushuyeva, “Oil in Exchange for $1.3 Billion”) gives a detailed account of the essence of the agreements concluded and underscores that the agreements seem to be a rare example of a win-win situation for all parties concerned. As far as TNK is concerned its long-held dream to become the sole partner of the Anglo-American BP p.l.c. in SIDANCO will at last come true. Interros exits the oil project with a significant sum of money in its pockets. “All projects have an end. We have come out of the SIDANCO project with a good financial return, not only for us but also for the other investors,” proudly announced Dmitry Ushakov, the Interros General Director, yesterday. During the privatization period, Interros purchased about 90% of SIDANCO’s shares for $350 million. For several years the group has been gradually selling this stake to other shareholders – first to Kantupan, then to BP and finally to TNK. The company’s revenues from oil business sale will clearly exceed $1 billion.
03.08.2001
Commersant
Despite the unsteady position of SIDANCO in recent years, this company yielded a significant profit to Interros
Commersant (P. Sapozhnikov - “Interros Shed Oil For RUSIA Petroleum”) gives a detailed report on the agreement, and emphasizes that the companies will halt all court cases initiated against each other in Russia and abroad.
According to the newspaper, TNK will pay almost $1.3 billion for its stake in SIDANCO. Given the cost of stakes sold earlier to BP and Kantupan, this signifies that, despite the unsteady position of SIDANCO in recent years, it yielded a significant profit to Interros.
Commersant reports on the press conference held yesterday with the participation of M. Friedman, V. Vekselberg, D. Ushakov, R. Sheppard and P. Henshaw, saying they “found a great deal of gentle words for their recent rivals. Nearly every presentation included something to the effect that the parties had at last reached a compromise, and found a way to contribute to the welfare of SIDANCO and RUSIA Petroleum.”
03.08.2001
Vremya Novostey
In a year and a half, great changes may occur in the Russian oil sector
Vremya Novostey (N. Gorelov – “A Very Large Friendship”) reports that the Tyumen Oil Company, which starting yesterday is considered a SIDANCO major shareholder, has become Russia’s third largest oil producer, after LUKoil and Yukos. The article draws readers’ attention to the fact that in a year and a half, great changes could occur in the Russian oil sector. For instance, BP Amoco could bring TNK under its control. But analysts suspect that these are only words.
According to Peter Henshaw, Director for Public Relations of BP Amoco Russia, the three-year agreement on managing SIDANCO means that if SIDANCO were included in a unified company formed after TNK shifts to a single stock (planned to take place in 18 months), BP would become not just a minority shareholder of TNK, but would acquire managerial functions. But this is only possible if the companies are able to establish effective management in SIDANCO, Henshaw said.
While Mikhail Friedman thinks that merging the companies “could be strategically interesting,” analysts say it is practically impossible. Mikhail Friedman has often announced that he would sell the Alfa assets for a good price. But in this case it would be rather strange to let go control over the country’s third largest oil company.
03.08.2001
Vremya MN
In the near future TNK and SIDANCO will probably merge, making the joint oil company the third largest oil producer
Vremya MN (M. Klasson – “The Oil War Comes to an End”) says that, though TNK shareholders own about 84% of the SIDANCO shares, British Petroleum will maintain operational control over SIDANCO for the next three years.
03.08.2001
Noviye Izvestiya
Everybody has probably recognized that it would be better for all the parties concerned if Interros pulled out of SIDANCO completely
Noviye Izvestiya (by Vyacheslav Shiryaev, “Potanin’s Fed up with Oil”) notes that in the recent years when managed by UNEXIM Bank, SIDANCO lost almost everything it could lose. As a result it practically appeared to be an outsider on the Russian oil market. “For this reason it has rumored for the past three years that SIDANCO is doomed.” The newspaper reminder the readers that LUKoil intended to take over SIDANCO, but this did not happen because of BP’s negative attitude toward the plan.
“To all appearances, Robert Sheppard and BP on the whole didn’t yet realize that the process of SIDANCO’s decay was irreversible. Moreover, TNK had a finger in this pie and was aimed to take from SIDANCO everything down to the last scrap. It has mostly succeeded in it,” the author comments.
Reminding of an agreement on the Chernogorneft return to SIDANCO in exchange for a blocking stake, Shiryaev notes that “eventually the situation has totally changed. At the end of the day, everybody recognized that it would be better for all the parties concerned if Interros pulled out of SIDANCO completely.”
03.08.2001
The Moscow Times
The Moscow Times noted that the head of Interros, B. Potanin, was conspicuously absent at a press conference on the sale of the SIDANCO's assets
The Moscow Times (by F. Raff “TNK Strikes Deal for SIDANCO”) reports on a press conference of the heads of Interros, Alfa Group and BP on the sale of the SIDANCO’s assets. The newspaper cites Interros General Director Dmitry Ushakov saying: “In the past, we faced a lot of problems, including the loss of subsidiaries. Nevertheless, we are leaving SIDANCO, we are leaving the Board of Directors. We wish TNK success in running the company.” Vladimir Potanin, who controls the Interros holding, was noticeably absent, the publication emphasizes. Raff reports that Interros' remaining assets include Norilsk Nickel and Rosbank.
03.08.2001
Prime-TASS
The RF Ministry for Taxes has drawn up the list of fifty-one oil exporters who underpaid taxes to the federal budget
A source close to the RF Ministry for Taxes reports that the Ministry has drawn up the list of fifty-one oil exporters who underpaid taxes to the federal budget as for July 1, 2001, and whose export operations will be reduced. Among these companies are Severgazprom, Vostokgazprom, the Nenets Oil Company, Chernogorneft and ZAO Petrosakh.
03.08.2001
Neue Zurcher Zeitung
The newspaper continues: “Whatever the profit from the sale was – it was not announced - Potanin will not be out of pocket. The three partners have reached an agreement to coordinate their policy in developing the big Kovyktinskoye gas condensate field. The oil companies (for the first time Gazprom is excluded) declared their intention to supply natural gas from East Siberia to China. This gives the ‘green light’ to investing huge amounts in the Kovyktinskoye field, estimated by the head of BP head at hundred millions of dollars. “But first, they will have to score a win after parliamentary discussions of the Law ‘On Production Sharing,’” the publication emphasizes. At present, the parties have at least come to one important conclusion: “Cooperation is better.”
02.08.2001
Prime-TASS
“Cutting the Gordian Knot”, Izvestiya
“Oil in Exchange for $1.3 Billion”, Vedomosti
“Interros Shed Oil For RUSIA Petroleum”, Commersant
“A Very Large Friendship”, Vremya Novostey
“Potanin’s Fed up with Oil”, Noviye Izvestiya
The court has postponed SIDANCO’s lawsuit on the sale of a controlling stake in Varieganneftegaz until August 24
“At a July 27 meeting, the Moscow Arbitration Court postponed SIDANCO’s lawsuit against its subsidiary, Varieganneftegaz, and the Financial and Industrial Bank to invalidate the agreement on the purchase and sale of a controlling stake in Varieganneftegaz, until August 24.
The court postponed the lawsuit due to the fact that a third party, OOO ST-Emeks, a third party in the case, filed a petition Thursday to postpone the lawsuit, claiming that it had not been properly notified of the date and location of the hearing.”
02.08.2001
Interfax-ANI
SIDANCO Daily Press Coverage
Media Reports on SIDANCO and Its Partners
Interros will sell its stake in SIDANCO to the Alfa Group and Access/Renova Consortium
A joint statement released Thursday by the Alfa Group, Access/Renova and Interros, on the subject of their agreement to exchange assets and cooperate in the oil and gas sector, announces that the Interros Group has taken the decision to sell stakes held by companies in the group SIDANCO to the Alfa Group and Access/Renova Consortium.
The statement reports that Interros will purchase the SIDANCO shares on economic terms, analogous to the terms for the deal with Kantupan.
The Alfa Group recently purchased a 40.3% stake in SIDANCO from Kantupan.
Upon the agreement coming into force, TNK’s ownership in SIDANCO will be 90%, and BP will retain 10%.
The parties have agreed to terminate the court case in London, as a result of which the SIDANCO shares held by Kantupan were seized. This will allow the Alfa Group and Kantupan to conclude their deal. BP, a British company, will maintain operational control over SIDANCO.
The agreement further says that TNK’s shareholders will return the Chernogorneft assets to SIDANCO.
The parties to the agreement claim that they have reached parity in their equity stakes in RUSIA Petroleum, as a result of which TNK and Interros have settled their relations within the consortium
According to the agreement, Interros will not contest the legality of decisions taken at the RUSIA Petroleum annual shareholders meeting, for RUSIA Petroleum to issue an additional 10% of equity in favor of TNK.
SIDANCO has decided to sell its stake in RUSIA Petroleum to BP, the Interros Group and TNK.
Irkutskenergo has exercised its right to purchase the 7% stake in RUSIA Petroleum held by Interros, and has sold this stake to TNK.
According to the statement, an extraordinary shareholder meeting will be held in the near future, by initiative of the major shareholders in RUSIA Petroleum, to choose a new Board of Directors to include representatives from all shareholders.
The statement says that the parties highly esteem the contribution of BP towards successful conclusion of negotiations.
02.08.2001
Prime-TASS
The Interros Group will sell its 44% stake in SIDANCO to TNK for $650 million
The Interros Group is selling its 44% stake in SIDANCO to the companies of the Alfa Group Consortium and Access/Renova, which are TNK’s key stakeholders. This information was announced in a press release circulated today by the companies.
Alfa Group Board of Directors Chairman Mikhail Friedman said at a press conference today that the sum of the deal is $650 million, and that the deal was conducted on the basis of SIDANCO’s current $1.5 billion capitalization.
The statement goes on to say that the transaction will follow “the economic terms analogous to those of the Kantupan deal.”
Prime-TASS reported earlier that TNK has reached an agreement on the purchase of the controlling stake held by the Cyprus-based Kantupan, which owned a 40.3% stake in SIDANCO.
According to the statement, TNK’s shareholders are returning the Chernogorneft assets, obtained through a bankruptcy procedure, to SIDANCO, which owns a controlling stake in Chernogorneft.
02.08.2001
Prime-TASS
The Board of Directors of the SIDANCO Oil Company will be formed so that the shareholders in the company receive proportional representation – M. Friedman
The Board of Directors of the SIDANCO Oil Company will be formed so that the shareholders in the company receive proportional representation. This was announced at a press conference Thursday by the head of Alfa-Group, the major shareholder in SIDANCO, Michael Friedman.
In his words, at the same time British Petroleum will continue to hold operational control over SIDANCO for the next three years. Without doubt however, Russians will also participate in the operational management to ensure the company is as efficient as possible.
According to the completed deal between the shareholders of TNK and SIDANCO on the purchase of Interros’s 44% stake in SIDANCO, TNK will control more than 80% of the shares in SIDANCO.
An additional 10% of shares are held by BP. The remaining equity is in the hands of minority shareholders, although the SIDANCO management announced at the beginning of the year that minority shareholders will be bought out. At present, SIDANCO’s declines to comment on the extent to which these minority shareholders have already been bought out.
02.08.2001
Prime-TASS
The SIDANCO Oil Company Welcomes the Conclusion of an Agreement between Shareholders on the Return of Chernogorneft assets
The SIDANCO Oil Company welcomes the conclusion of an agreement between the shareholders of SIDANCO and the Tyumen Oil Company, in accordance with which the assets of former subsidiary Chernogorneft will return to SIDANCO. This was announced by a company press release, received today by Prime-TASS.
The company considers that the return of the Chernogorneft assets, along with the re-establishment of SIDANCO’s control over Varieganneftegaz (VNG), signify concrete growth in the company’s production capabilities, a significant increase in oil extraction volumes, and re-establishment of SIDANCO’s position as one of the largest Russian oil companies.
SIDANCO’s President, Robert Sheppard, announced “the SIDANCO management greatly appreciates the trust accorded it by its shareholders, in giving us the opportunity to manage this significant asset.”
In his words, “SIDANCO will build a long-term, mutually beneficial relationship with all of Chernogorneft’s clients and partners. We are prepared to work hard together to achieve the maximum returns from this company for all of its shareholders on the basis of concrete production and investment plans for various fields.”
02.08.2001
Interfax-ANI
Merging TNK and SIDANCO assets will occur no earlier than 1-2 years - Friedman
The merging of SIDANCO assets with Tyumen Oil Company (TNK) will take place not sooner than in one or two years, Mikhail Friedman, director of the Alfa Group supervisory council, told journalists in Moscow on Thursday.
In the meantime the main task of TNK shareholders will be to set up an effective team of managers under BP management, he said.
“If we succeed in setting up this team and if the parties feel comfortable, then in the future we will consider the issue of merging TNK and SIDANCO assets,” he said.
02.08.2001
Prime-TASS
BP Plc does not rule out the possibility of a merger between the Tyumen Oil Company and SIDANCO.
Peter Henshaw, BP Russia’s Director of Public Affairs said at today’s briefing that an agreement signed between Novy Petroleum, which represents TNK’s interests in SIDANCO, and BP to maintain BP management of SIDANCO for three years, also envisions that BP could manage the company if SIDANCO’s assets were to be merged with TNK.
He emphasized that “if the relations between TNK and BP work out well, BP would with pleasure take the opportunity to manage the company if SIDANCO and TNK were to merge.”
Henshaw also said, that SIDANCO’s management structure will be formed at the discretion of SIDANCO President Robert Sheppard. During the negotiations between TNK and SIDANCO, acknowledgement was made of the company’s successful performance under the supervision of President Sheppard. He admitted that the negotiations had included a discussion on the possibility of a TNK representative managing the company’s finances.
Earlier today, it was reported that the Tyumen Oil Company has purchased 44% of SIDANCO’s shares from Interros for $650 million. TNK’s shareholders, as a result, control 85% of SIDANCO’s shares.
02.08.2001
Lenta.Ru
A forum of an information site Lenta.Ru started to discuss Interros’s sale of its stake in SIDANCO
An Internet site Lenta.Ru (www.lenta.ru) has kicked off a forum to discuss Interros’s sale of its stake in SIDANCO. There have been such messages such as: “Isn’t it too much for me? I mean such a fat piece… Friedman.” (Similar massage was signed by SIDANCO); “Interros has earned a billion dollars from Sidanco!” (a calculation of the revenues from the sale of the stakes less the sum initially paid for the company at the auction is provided).
02.08.2001
“Joint Economy”, Izvestiya
"The War Ends”, Vedomosti
“TNK Finally Reconciles with SIDANCO”, Commersant
Interfax-ANI
Prime-TASS
SIDANCO has gotten the Chernogorneft assets back and re-established its control over Varieganneftegaz
“SIDANCO welcomes the conclusion of an agreement between the shareholders of SIDANCO and TNK, in accordance with which the assets of former subsidiary Chernogorneft will return to SIDANCO.
The long-running argument between the shareholders of oil companies TNK and SIDANCO has been resolved.
The agreements seem to be a rare example of a win-win situation for all parties concerned.
The companies (note: SIDANCO and TNK) will halt all court cases initiated against each other in Russia and abroad.”
01.08.2001
Interfax-ANI
Prime-TASS
SIDANCO Press Coverage
in National Media
Key Publication Issues
Situation with the return of the Chernogorneft assets to SIDANCO prior to SIDANCO and TNK shareholders sign an agreement
“Today TNK and SIDANCO will sign two sets of documents: one set concerning the return of Chernogorneft assets to SIDANCO and another on dividing up RUSIA Petroleum’s shares.
This will put an end to the two-year war between the shareholders of the two oil companies.
The agreement also stipulates that TNK will return the Chernogorneft assets to SIDANCO.”
No. 8 (147), 2001
Sovershenno Secretno
Sovershenno Secretno reports on business activities of by American Vice-President, Richard Cheney, and reminds the readers of his relations with TNK
Sovershenno Secretno (L. Abarinov, L. Velekhov – “Russian Business connections of the American Vice-President”), reporting on the business and political activities of the American Vice-President, Dick Cheney, reminds the readers of the Chernogorneft scandal, when Uneximbank blocked the loan granted to TNK. The major part of the loan was intended for the ‘Halliburton’ company, then run by Cheney.
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