April 27, 2018 / 5:13 PM / in a year

Intesa Sanpaolo not concerned about Glencore loan for Rosneft

TURIN, Italy (Reuters) - Intesa Sanpaolo is not concerned about the loan of more than 5 billion euros ($6 billion) it granted Glencore and Qatar Investment Authority last year to fund the acquisition of a 19.5 percent stake in Rosneft, the bank CEO said on Friday. “Absolutely not,” Carlo Messina said on the sidelines of the lender’s shareholder meeting (AGM) in Turin when asked if he was worried about the financing to Glencore. Glencore and QIA agreed to buy a 19.5 percent stake in Rosneft in December 2016 for over 10.2 billion euros to help the Kremlin plug budget holes.

Italy’s biggest retail bank helped fund the deal with a 5.2 billion euro loan.

But in September last year Chinese conglomerate CEFC agreed to buy a 14.16 percent stake in Rosneft for $9.1 billion from Glencore and QIA.

“The financing will be reimbursed when the sale of the Rosneft stake by Glencore to CEFC is finalised,” Intesa Sanpaolo Chairman Gian Maria Gros-Pietro said during the AGM.

“It is amortizing regularly and has a December 2021 maturity,” he added.

The original transaction coincided with expectations of political detente between Russia and the United States after Donald Trump became president and pledged to improve ties with Moscow. But relations soon soured, leading to the imposition of further economic sanctions on Russia, making it difficult for large Western firms like Glencore to develop partnerships and increase ties with state-owned firms such as Rosneft.

CEFC has in the meantime been hit by legal action from a creditor.

($1 = 0.8256 euros)

Reporting by Gianluca Semeraro, writing by Stephen Jewkes; Editing by Adrian Croft

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