February 2, 2012 / 9:36 AM / 8 years ago

RPT-UPDATE 4-Petroplus refineries draw more suitors

* Equity group Goldsmith interested in all five refineries

* In contact with German, UK and Swiss administrators

* Over 40 parties interested in UK Coryton plant -minister

* More than one offer for Petit Couronne -French minister

* Shares in Petroplus up more than 70 pct

By Caroline Copley

ZURICH, Feb 2 (Reuters) - More potential buyers lined up for the assets of insolvent refiner Petroplus on Thursday, with private equity group Goldsmith registering interest in all five of its plants.

Swiss-based Petroplus, Europe’s largest independent refinery by capacity, is filing for insolvency after battling with high debt and poor refining margins.

The company was forced to close three of its refineries, including Petit Couronne in France, after lenders froze credit lines late in December.

Goldsmith, already a shareholder in Petroplus through a fund, said it had registered its interest with the refiner’s administrators in Germany, Britain and Switzerland.

“Petroplus’ refinery businesses in Germany, Britain and Switzerland, but also in France and Belgium, are sustainable and interesting, despite the current difficulties in this sector,” Goldsmith Group said in a statement.

Goldsmith plans to carry out due diligence on parts of the business in Belgium and France, it said.

A spokesman for the administrators of the Petroplus Ingolstadt refinery in Germany declined to comment on possible investors.

French Energy Minister Eric Besson told France Info radio there were a number of potential buyers for the Petroplus French refinery at Petit Couronne.

Swiss investment vehicle Gary Klesch Group said last week it was considering purchasing the French plant, which stopped production last month, and possibly other refineries owned by Petroplus.

Besson said he hoped he could announce the restart of the refinery within the next 15 days.

The company’s UK refinery at Coryton has attracted more than 40 interested parties, UK Energy Minister Charles Hendry said.

“I understand there have been over 40 expressions of interest in Coryton from companies around the world, which is extremely encouraging. Work will now focus on securing a sustainable long-term future for the refinery,” Hendry said.

DOUBTS

Founded by German businessman Clemens J. Vedder in 2007, Goldsmith dropped out of a bidding race in 2009 for German retailer Metro’s department store chain Kaufhof.

Industry analysts said they doubted private equity groups would be able to turn around Petroplus, because the structural problems facing European refiners had defeated even the biggest oil companies.

Poor margins have forced several European refiners to put plants on the market, and some have been unable to find buyers.

“The majors could not make money out of those assets, and now you have some private equity groups, be it Klesch or Goldsmith, that supposedly can make it better. I doubt it very much,” said Olivier Jakob, an energy analyst at consultancy Petromatrix.

“In the long term, those refineries need somebody involved in the oil trade - a supplier from ex-Russian republics or Asia, not just a financial group that just buys something distressed and then tries to sell it two years afterwards.”

The leveraged finance market, one way private equity groups raise money for purchases, is difficult to tap, bankers say, casting some doubt on the number of potential buyers for Petroplus.

“We need to take things with a pinch of salt. Most oil companies and private equity companies will have, at the very least, kicked the tyres and attempted to get as much information as possible. How many of them are serious (and at what price) is another matter,” said one analyst who has looked at Petroplus.

Refining industry analyst Roy Jordan at Facts Global Energy says more closures are needed for processing margins to recover.

“We can see nothing on the horizon which would provide relief to existing European refiners without a reduction in capacity,” Jordan said. “We cannot see a future for new investment in European refinery distillation capacity. And it is difficult to see how deals with large debt and leverage would be attractive on a sustained basis.”

Shares in Petroplus have plunged since lenders froze credit lines in late December. They jumped 73.4 percent to 1.11 Swiss francs at 1619 GMT.

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