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. Last Updated: 07/27/2016

Yukos Set on Registering Issues This Year




NEFTEYUGANSK, West Siberia -- Russia's No. 2 oil company, Yukos, is determined to register two disputed share emissions in its subsidiaries with the Federal Securities Commission before the end of the year, chief executive Mikhail Khodorkovsky said Tuesday.


Yukos says this will allow sufficient time to consolidate shares in the firm's production units into a single share by summer 2000.


"We plan to complete negotiations with shareholders [in production subsidiaries] in the first quarter next year," Khodorkovsky said.


Yukos plans to register before the end of 1999 the prospectuses for share emissions at Yuganskneftegaz and Tomskneft. The holding has already succeeded in securing FSC approval for the issuance of 67 million new shares at its Samaraneftegaz subsidiary.


The share floats - which would almost triple the number of shares in the three subsidiaries - were approved in March at three separate, controversial extraordinary shareholders meetings.


The new securities are to be sold under a closed subscription to offshore investment firms in exchange for promissory notes.


Minority shareholders - led by styrofoam cup king Kenneth Dart - have fiercely resisted Yukos' plans.


While Khodorkovsky said in Nefteyugansk that he was willing to negotiate with Dart and other minority shareholders, officials in Moscow representing Dart vowed Thursday that they would continue to contest Yukos' plans.


"We disagree with these share issues, which are destructive to Russian capital markets," said Sharon Cornwell, a spokeswoman for Dart's companies that operate in Russia.


Any Yukos share emissions registered by the Federal Securities Commission would be disputed in the courts, Cornwell added, in a telephone interview.


Yukos says it can force minority shareholders to negotiate because it already commands the necessary block of votes - 75 percent plus one share - to get the share swap approved.


If the oil holding is right, then the minority shareholders would have no power to stop the deal.


Dart's companies disagree with Yukos' assessment, Cornwell said.


However, the possibility of an amicable settlement with Yukos' managers cannot be excluded, she added.


In March, after similar months of bitter public dispute, Dart reached agreement with oil major Sibneft on that firm's similar plans to consolidate its stake in production subsidiary Noyabrsknefetgaz.


- Staff writer Igor Semenenko contributed to this report from Moscow.