India

EXCLUSIVE Trafigura plans to exit Rosneft Indian refining JV -sources

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Trafigura logo is pictured in the company entrance in Geneva, Switzerland March 11, 2012. REUTERS/Denis Balibouse

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NEW DELHI/SINGAPORE, Nov 16 (Reuters) - Trafigura is preparing to sell its 24.5% indirect stake in an Indian oil refining joint venture with Russia's Rosneft to an Italian group, a letter seen by Reuters shows and people familiar with the commodity trading firm's plans said.

Trafigura holds the stake in Nayara Energy, which owns India's third largest refinery, a port and a network of more than 6,000 fuel stations across India, indirectly through a 49.84% holding in Singapore-based Tendril Ventures Pte Ltd.

It plans to sell the Nayara stake to Italy's Genera Group Holding S.P.A, people familiar with the matter said, without giving detail on what had prompted Trafigura to sell.

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"We have been informed that Trafigura proposes to sell its shareholding in Tendril to a third party; being Genera Group Holding S.P.A.," Nayara's chief executive Alois Virag wrote in a letter to its lenders earlier this month.

Trafigura declined to comment. Genera did not respond to Reuters emails and messages seeking comment. Nayara said it could not comment on the actions of its shareholders.

It is unclear how much Trafigura's stake in Nayara, formerly known as Essar Oil, is worth.

Nayara, which owns the 400,000 barrels-per-day (bpd) Vadinar refinery plant in the western Indian state of Gujarat, changed hands for nearly $13 billion in 2017, so the Trafigura stake then would have been worth more than $3 billion.

The other owner of Tendril is Russian investment group United Capital Partners (UCP), which also has 49.84%.

Tendril's wholly-owned subsidiary, Cyprus-registered Kesani, owns a 49.13% stake in Nayara Energy. Rosneft's Singapore unit also has a 49.13% stake and public shareholders the remainder.

When Kesani and Rosneft bought the Nayara stakes in 2017, the sale was structured in a way to prevent Rosneft (ROSN.MM) from acquiring a controlling stake and avoid running foul of U.S. sanctions on the Russian oil major.

"As a result of the proposed transfer, Trafigura will cease to hold an indirect shareholding in Kesani and hence also in the borrower (Nayara)," Virag says in the letter seen by Reuters.

After the transfer, Genera will hold a 24.5% stake in Nayara, through Tendril and Kesani, the letter said.

Tendril, which shares its official address with Trafigura in Singapore, could not be reached by Reuters for comment.

Nayara Energy has written to its local and global lenders including State Bank of India (SBI.NS), Punjab National Bank (PNBK.NS), HDFC Bank (HDBK.NS), Axis Bank (AXBK.NS), Canara Bank (CNBK.NS), ICICI Bank (ICBK.NS), Citibank (C.N) and Barclays (BARC.L) to request a no objection certificate.

Genera has meanwhile approached the anti-trust regulator Competition Commission of India (CCI) seeking permission to acquire Trafigura's stake in Nayara, sources said.

The Indian banks and CCI did not respond to requests for comment. Citibank and Barclays declined to comment.

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Additional Reporting by Julia Payne in London and Stephen Jewkes and Elisa Anzolin in Milan; Editing by Simon Webb and Alexander Smith

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