TNK-BP Oligarchs Dismiss Talk of Sale

The Russian shareholders who own half of embattled oil major TNK-BP issued a rare statement Thursday strongly denying any intention to sell their stakes in the British-Russian venture.

"Speculation and rumors of a planned sale by AAR of its stake in TNK-BP are groundless and have no basis in reality," said the shareholders, known collectively as AAR. Britain's BP owns half of TNK-BP, with the other half held by the oligarchs who own Alfa Group, Access Industries and Renova.

The statement came after Vedomosti business daily published alleged details of a deal that would see the shareholders sell their stake to state-run Gazprom for $20 billion.

"The consortium, which is a long-term strategic investor in TNK-BP, does not plan to divest its shareholdings in the company and has never held and is not now holding talks on the sale of its stake in TNK-BP," the statement said.

Rumors that Gazprom was hoping to buy out the Russian shareholders began nearly three years ago, amid signs of increasing state control over the energy sector. Market speculation intensified following the expiration late last year of a clause forbidding AAR from selling.

The firm's recent troubles, which include checks by environmental authorities, raids by the security services, visa troubles for employees, back tax claims, and the arrest of an employee, have prompted talk that the company is ripe for a partial takeover.

Vedomosti cited an unidentified source close to Gazprom management as saying the $20 billion deal would be closed by the end of the year. The source said the deal would also see Gazprom buy a 1 percent stake from BP, thus ensuring majority control over TNK-BP, the country's fourth-largest oil producer, the newspaper reported.

Yet sources inside BP and Alfa Group, owned by billionaires Mikhail Fridman and German Khan, denied that part of BP's stake was up for grabs in the talks, while confirming that negotiations over the Russian stake were being held, Vedomosti said.

TNK-BP declined to comment on the report, and Gazprom could not be reached.

The Russian shareholders, who also include Viktor Vekselberg of Renova and Len Blavatnik of Access Industries, issued a similar statement in February. Yet Vekselberg had said the previous month that he would consider selling if potential buyers met his $60 billion valuation of the firm.

A $20 billion deal would value the company at $40 billion, well above its market capitalization of $31 billion.

TNK-BP shares jumped 11 percent to $1.95 on the news.

Analysts welcomed the report, calling the valuation fair. Troika Dialog said in a research note that the move would also be positive since "the uncertainty surrounding the company and its political problems would disappear."

Gazprom deputy CEO Alexander Medvedev said Wednesday that the company was losing patience with TNK-BP over talks to buy Kovykta, the giant gas field it agreed to buy at a knockdown price in June. The deal was due to be completed by the end of last year.

"All in all, every Russian oligarch is dreaming of having his assets nationalized on market terms," Sobinbank said in a note, Reuters reported.