SOCHI/MOSCOW (Reuters) - Russian Rosneft’s (ROSN.MM) board will consider the possibility of buying out minority shareholders of TNK-BP Holding TNBP.MM, offering a premium and potentially winding up a long-lasting wrangle over how it treats smaller stakeholders.
Rosneft, led by Chief Executive Officer Igor Sechin, bought TNK-BP in a $55-billion takeover deal, becoming the world’s largest oil firm by output.
However, minority shareholders with TNK-BP Holding, the only trading unit of the acquired asset, were left out of the deal as Sechin said he was not obliged to compensate small stakeholders, some of which were Rosneft shareholders as well.
On Friday, Sechin said Rosneft may offer a 20 to 30 percent premium to the current share price, sparking a rally in the shares that replaced TNK-BP Holding.
“This will reflect a fair price, we think that the premium to the current prices will total 20 to 30 percent,” Sechin told a panel discussion in Russia’s Black Sea resort of Sochi.
Shares in Rosneft added 0.5 percent while those of RN-Holding, formerly known as TNK-BP Holding, jumped as much as 12 percent.
Shares in RN-Holding, where minority shareholders own around 5 percent, are still about 26 percent below this year’s peak in January, before Rosneft completed its $55 billion purchase of TNK-BP.
In June, Rosneft Vice-President Igor Maidannik said that the state-owned giant’s shares are sensitive to the situation, so it may consider buying out the minorities or offering conversion into Rosneft’s shares.
Based on RN-Holding’s current market capitalization of $25.7 billion, buying out minorities would cost Rosneft around $1.3 billion if no premium was offered to potential buyers - close to the price Rosneft agreed to pay for gas assets from diamond miner Alrosa (ALRS.MM), in a drive to expand its natural gas business.
Reporting by Vladimir Soldatkin and Katya Golubkova; editing by Alessandra Prentice and Keiron Henderson