Group Action

Group MENATEP Will Pursue Gazprom's Creditors

The YUKOS Affair

Group MENATEP, YUKOS's largest shareholder will prosecute not only the buyers of Yuganskneftegaz, but also banks that are willing to lend to the winner of the tender. Tim Osborne, Group MENATEP's managing director, informed Kommersant of this yesterday. The most likely winner of the auction set for December 19 is considered to be Gazpromneft, a Gazprom subsidiary. However, there is no assurance that the auction will go off smoothly. Kommersant has learned that Interior Ministry officials carried out operational actions at ABN AMRO and Deutsche Bank, which are preparing to lend to Gazprom. This could mean that the scheme to have Gazpromneft buy YUKOS's assets does not have the full approval of the power structures.


Financial Allies

We recall that 77% of the shares of Yuganskneftegaz owned by YUKOS are to be sold at auction – the money from the sale will go towards paying the parent company's tax arrears. Group MENATEP first announced yesterday that it could switch from a passive defense of Yuganskneftegaz to aggressive actions. Tim Osborne, Group MENATEP's managing director, told Kommersant that suits would be filed in non-Russian courts not only against participants in the Yuganskneftegaz auction.

“We regard this sale as expropriation and we would like all auction participants to understand that participation may have legal consequences for them. This applies equally to Western banks that will be associated with the deal,” Mr. Osborne said. Other Group MENATEP officials do not deny that the matter concerns suits against the members of a credit syndicate that is proposing to grant credit to Gazprom to pay for the Yuganskneftegaz shares.

On Friday, lawyers for former YUKOS president Mikhail Khodorkovsky Yury Shmidt and Robert Amsterdam discussed the positions of the governments of EU countries that are “encouraging their countries' banks to finance the unlawful expropriation of Yuganskneftegaz”. In their opinion, the leaders of these countries “prefer not to see the flagrant violations of human rights” in the YUKOS affair and the sale of Yuganskneftegaz.

Despite the fact that last week Gazprom's board of directors amended the company's investment program for 2004-2005, the gas monopoly currently does not have the internal funds available to buy Yuganskneftegaz, even at the starting price of $8.65 billion. Gazprom is presently negotiating with six Western banks – ABN AMRO, Deutsche Bank, BNP Paribas, Calyon, Dresdner Kleinwort Wasserstein (DrKW), and J.P.Morgan. Their syndicate is expected to grant €10 billion.

Last week, Gazprom's board of directors approved the attraction of credit and Gazpromneft's participation in the auction. At the same time, according to unofficial information, Prime Minister Mikhail Fradkov and Deputy Prime Minister Aleksandr Zhukov refused to sign a directive on voting for representatives of the state-owned block. Gazprom is not commenting on this information.

Asian Competitors

To prevent the auction from looking like a direct sale of YUKOS's assets to a state company (Gazpromneft), some harmless competitors are hastily being rounded up. The Federal Antimonopoly Service (FAS) reported on Friday that it had received three applications for gaining control of Yuganskneftegaz – from OOO Gazpromneft, OOO First Venture Company (PVK), and ZAO Interkom. The FAS announced that it would consider applications received up to December 18 – the deadline for paying a deposit of $1.7 billion to take part in the bidding for Yuganskneftegaz.

Aleksandr Stepanenko, Gazpromneft's press secretary, confirmed that the company itself, not a double, had applied to the FAS. There is no objective information on the other two contenders – the FAS is refusing to even the name cities where PVK and Interkom are registered. These companies are most likely stand-ins for Gazpromneft. Kommersant's sources in Gazprom are not denying this theory.
However, at one of the investment banks working with Gazprom, they told Kommersant that PVK is a structure that previously appeared on behalf of Surgutneftegaz. Raisa Khodchenko, Surgutneftegaz's press secretary, would neither confirm nor deny this information. In a private conversation, a senior Surgutneftegaz employee told Kommersant: “Our application is either already at the FAS or will show up there within a few days. There is a 99% probability that we will be forced to secure Gazpromneft at this auction.”

Surgutneftegaz, with available cash resources now exceeding $6 billion, could quite easily send a provisional $1.74 billion deposit for one of the fictitious auction participants to the Russian Federal Property Fund's (RFFI) accounts at the Cash Department of the Central Bank. This solves the problem of preventing the auction from being cancelled because only one application was received, and no one will be able to expose Gazpromneft as the only contender.

The list of possible contenders for Yuganskneftegaz besides Gazpromneft and Surgutneftegaz is not very large. Tim Osborne told Kommersant yesterday that Group MENATEP would not take part in the bidding for Yuganskenftegaz. Except for an alliance of the Indian companies ONGC and IOC, whose intentions are unknown, and the China National Petroleum Corporation (CNPC), no one has announced the possibility of their participation in the auction.

The Chinese are still pondering whether or not to go to the auction on December 19. On Saturday, a senior official of the energy directorate of the Chinese state committee for development and reform told Interfax that no final decision had been made. However, the Chinese official stressed that in this case, the interests of strategic cooperation between CNPC and Russia in the industry were “more important than acquiring part of the shares of one company”.

Presale Check

The purchase of Yuganskneftegaz by Gazpromneft using funds from Western banks, with Surgutneftegaz acting as a safety net, also appears to be not without conflict. Kommersant has learned that officials of the Ministry of the Interior (MVD) and other power structures paid visits to the Moscow offices of Deutsche Bank and ABN AMRO. Deutsche Bank has privately confirmed the visit of the investigators, while ABN AMRO is refusing to comment on the situation. The Interior Ministry's press service has also not commented on the incident.

The fact is that according to the version circulating among stockbrokers and investment company employees, the siloviki were interested in the two banks not only because of payments by YUKOS structures to Western creditors on old loans, but also because of documents relating to Deutsche Bank and ABN AMRO's preparation as lead managers of a €10 billion loan for Gazprom. “My colleagues were in shock when they heard the news about ABN AMRO. We never thought that the disagreements within the government over Yuganskneftegaz had gone so far,” the head of a major Moscow investment company told Kommersant in commenting on the situation.

We note that according to Kommersant's information, Vneshtorgbank had previously approached the Central Bank with a proposal to allow it to increase Gazprom's credit limits for financing Gazpromneft at the Yuganskneftegaz auction, using Central Banks funds deposited in Vneshtorgbank and Vneshekonombank for this. Yesterday at Vneshtorgbank they told Kommersant that they had no intention of crediting Gazprom. Nevertheless, last week a high-ranking Central Bank official confirmed the fact of the application with Kommersant, saying that according to his information, Central Bank Chairman Sergey Ignatiev had rejected Vneshtorgbank's proposal.

According to Kommersant's information, the chairman of Rosneft's board of directors, Igor Sechin, had lobbied for the scheme to sell Yuganskneftegaz to Gazpromneft using Vneshtorgbank's money, while the chairman of Gazprom's board of directors, Dmitry Medvedev, had lobbied for the scheme to sell on foreign credit. The banks' profits from taking part in crediting Gazprom are estimated at tens of millions of dollars. It is not inconceivable that the investigators' visit to Deutsche Bank and ABN AMRO is connected with a dispute between two groups of bureaucrats. This means that if Gazpromneft buys Yuganskneftegaz at the auction, the conflict over YUKOS's main production unit could continue into 2005, even without Group MENATEP's participation.

More Debt for Samaraneftegaz

On Friday it was learned that the tax authorities had completed an audit of OAO Samaraneftegaz (one of YUKO's oil producing companies) for 2001 and 2003. Moscow's Interregional Tax Inspectorate #1 for large taxpayers of the RF presented Samaraneftegaz with claims amounting to 8.5 billion rubles for 2001 and 4 billion rubles for 2003. Kommersant's sources at Samaraneftegaz said that the company would send objections to the tax audit reports for 2001 and 2003 to the tax authorities; however, according to Kommersant's informants, the amount of tax arrears would probably “only increase”. We recall that several weeks earlier, the tax authorities considered Samaraneftegaz's objections to the results of an audit of the company for 2002 and increased their claims from 7.5 billion rubles to 8.5 billion rubles.

by Dmitry Butrin, Elena Kiseleva, Evgeny Khvostik; Elena Naumova, Samara

(Kommersant, 12.14.2004)