Yukos' core unit to be valued at $9-16 bn

Valuation of Russian oil major Yukos’ core unit should be complete within four weeks and may not set a single price, sources said on Wednesday. Yukos missed a deadline this week to pay a $3.4bn tax debt for ‘00, and bailiffs have singled out its Yugansk production unit for sale to recover that demand.

The justice ministry hired investment bank Dresdner Kleinwort Wasserstein last month to value Yugansk, which pumps over 60% of Yukos’ 1.7m barrels a day output.

Sources said the process was going smoothly and the final valuation of Yugansk would take into account various scenarios to determine a valuation range rather than name a single stand-alone number.

Analysts say a price range could be bad news for Yukos, as any low-end scenario would have to consider risks arising from legal troubles of the firm and its founder, Mikhail Khodorkovsky, who is on trial for fraud and tax evasion in what many see as a Kremlin payback for his political ambitions.

Estimates value Yugansk at $16bn, with the most pessimistic forecast at $9bn. Bob Foresman, DrKW’s head of Russian investment banking, declined to comment on the analysts’ price ideas or on the methodology of the valuation itself.

HERE