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. Last Updated: 07/27/2016

Court to Decide on Sidanko Manager




The Moscow arbitration court is expected to nominate an external manager for embattled oil major Sidanko in a bankruptcy hearing Friday, an official from one of the oil firm's major creditors said Thursday.


However, the creditors committee does not expect the court to confirm an amicable settlement overwhelmingly approved by the creditors last Friday, said Alister Graham, Sidanko's chief executive officer.


The court is likely to endorse the Sidanko creditors committee recommendation that professional arbitration manager Stanislav Yegoryshkov be tapped for the post, BP Amoco spokesman Howard Chase was quoted as saying last week by Reuters.


Graham was installed at Sidanko by BP Amoco, which controls a 20 percent stake in Sidanko, and has taken a major role in attempts by creditors and shareholders to steer the oil firm clear of troubled waters.


Sidanko was declared bankrupt in May.


The creditors first would like to resolve satisfactorily the bankruptcy procedures at several Sidanko subsidiaries, chiefly production units Chernogorneft and Varyoganneftegaz.


Sidanko has been losing control over several subsidiaries ? Varyoganneft, Kondpetroleum, Chernogorneft and Varyoganneftegaz ? since spring 1998.


Despite high hopes that the court on Friday will rule in line with creditors' wishes, the outcome is no sure thing, Graham said.


"The court has a legal ability to make any decision regarding the bankruptcy case and we've been surprised before." he said.


BP Amoco bought a 10 percent stake in Sidanko in 1997 and plans to increase its share in the company to a 25 percent holding.


The international oil major has also helped to institute better management practices at Sidanko, Graham said.


In the second quarter of 1999, Sidanko received cash for 80 percent of its deliveries to the domestic market, a radical change from the 33 percent cash collection rate it posted for the same period last year, he said.


The company's net profit mounted to a healthy $5.5 million for the April to June period this year, a rapid turnaround when set beside the $7.4 million loss it posted for the first quarter of 1999, Graham said.