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. Last Updated: 07/27/2016

Sintez Plans to Raise Standing By Purchasing Stake in TNK

Oil corporation Sintez has announced plans to regain its lost position as a major player in Russia's oil business by buying the 49.8 percent stake in Tyumen Oil Co., or TNK, to be sold Wednesday.

The corporation said TNK's management had created favorable conditions for buyers of the stake, Sintez president Leonid Lebedev said Monday.

"With the purchase of a 49 percent [TNK stake], we won't start a fight," Lebedev assured. "We are prepared to make compromises or, at least, to reach productive agreements."

Sintez represents the interests of some non-resident investors, Lebedev said. He refused to elaborate.

In addition to Sintez, TNK shareholders have placed two bids, and Diamant bank has placed a bid for the 49.8 percent stake.

Sintez holds a 10 percent stake in TNK's bankrupt production unit, Nizhnevartovskneftegaz.

Sintez had earlier lost out against the TNK shareholders, Access Industries, Renova and Alga Group, in the sale of TNK assets in June 1997. Sintez offered $500 million for a 40 percent stake in TNK against the current shareholders, the Novy Holding investment venture, which bid roughly $800 million.

By acquiring TNK assets, Lebedev hopes to lift Sintez's profile in the oil business. Sintez used to process about 15 million metric tons of crude at domestic refineries. "But our position has slipped back," the president said.

The Sintez-controlled Negusneft oil firm produces about 600,000 tons of crude per annum. The corporation processes about 200,000 tons of oil a month at Slavneft's Yaroslavl refinery, including contracted volumes for refining. Sintez holds a 27 percent stake in the refinery and an about 2 percent stake in Slavneft.

Sintez plans to participate in the sale of a 19.68 percent stake in the oil company next year.

Sintez operates as a crude and oil products export trader, with total volumes climbing to 6 million tons a year.