17 December 2003 01:46
Settling down THE LEX COLUMN:
Divorce settlements are often acrimonious. The arrangement between Yukos and
Sibneft to unwind their merger is a preliminary agreement, a road map to a
settlement, rather than a decree nisi. Rival suitors should not assume either
party will soon be free to enter a new relationship. Presenting the agreement
as a new transaction accepts that the merger was completed and circumvents
the possible payment of a Dollars 1bn break clause. Yukos is acting under
duress but will still press for compensation. Several of its executives are
under investigation or in prison. The likely scale of any damages would only
be a fraction of the break clause fee. But Yukos will be in no hurry to reach
a final settlement.
Amid a rising groundswell of nationalism, the Kremlin is unlikely to bless
the sale of a large oil stake to foreign interests before the March
presidential election. Indeed, acquiring a stake as large as 50 per cent may
not be possible for the foreseeable future.
Reports suggest that foreign suitors' ardour has not cooled. A stake in
the combined Yukos/Sibneft may have held more appeal but, notwithstanding
fears of greater state control, the strategic appeal of Russian assets
remains alluring. However, it is never easy for a board to agree to bid amid
so much uncertainty. Roman Abramovich, Sibneft's main shareholder, is
keen to secure a deal. But, with Yukos dragging its heels, the Kremlin
looking inwards and foreign buyers faced with growing risks, a swift second
marriage appears unlikely.
[FTI [The Financial Times]] |
RUSSIA IN FACTS
