Big Names Raise Stake In LUKoil

LUKoil said Thursday that shareholders Vagit Alekperov and Leonid Fedun recently increased their interest in the company, which fell more than 14 percent this week before news of the acquisition.

Alekperov and Fedun, who have incrementally bought shares in Russia's second-largest oil producer, together acquired another 0.26 percent, the company said in a statement. They paid 1,600 rubles per share.

Alekperov now owns 20.54 percent, while Fedun controls 9.21 percent, the statement said. ConocoPhillips holds 20 percent.

News of the acquisition sent the stock up 3.6 percent in afternoon trading, and it closed up 2.8 percent on the MICEX. The stock lost 5.6 percent Wednesday and 8.8 percent Tuesday amid a rough week for the Russian stock market.

Russian markets have been falling since May because of the global credit crunch and investor concern over Prime Minister Vladimir Putin's attack on Mechel in July. The brief war with Georgia aggravated the capital outflow.

LUKoil has lost 37 percent of its capitalization in the past three months.

Alekperov and Fedun, who are LUKoil's chief and deputy chief executives, respectively, chose an extremely good time for investment, analysts said.

Alekperov bought 1.2 million shares, while Fedun bought 800,000, LUKoil said, meaning that they paid a combined 3.2 billion rubles ($127 million).

A LUKoil spokesman said the shareholders told the company of the deal Wednesday, but that he did not know when the shares were purchased.

LUKoil shares cost around 1,600 rubles on the MICEX on Tuesday.

A short-term investor might want to wait for the stock to hit bottom before buying, said Natalya Milchakova, analyst at Otkritie. The time is right, however, for longer-term investors, she said.

VTB analyst Lev Snykov agreed, calling the purchase "timely."

Alekperov and Fedun most recently expanded their stakes May 6. Were they to pay the same price for the latest acquisition, they would have spent an extra 1.3 billion rubles ($49 million).