Yuri Beilin, Deputy CEO of YUKOS and President of YUKOS EP, said on Tuesday that YUKOS was going to consider the interests of all shareholders in implementing the reverse deal. He confirmed that a protocol on the reverse deal to divide the assets of the two companies had been signed by the representatives of the main shareholders of YUKOS and Sibneft. Mr. Beilin stressed that the implementation of the agreement on the part of the YUKOS management was only possible if this decision “does not contradict the law and the company’s articles of association”. In executing the reverse deal, the company would comply with the accepted norms of corporate governance and corresponding corporate procedures, Mr. Beilin noted.

Sibneft does not comment on the signing of the protocol.

In early October, YUKOS announced the completion of its merger with Sibneft, having acquired a 92 percent stake in Sibneft. According to the merger agreement, YUKOS purchased 20 percent minus one share of Sibneft for $3bn, and another 72 percent plus one share was swapped for a 26.01 percent stake in YUKOS. As a result, Sibneft shareholders were to control 26.01 percent of the united company. The united company was expected to start operating on January 1, 2004.

Platon Lebedev, a large shareholder in YUKOS, was detained on July 2, 2003, on suspicion of stealing a 20-percent stake in the company Apatit in 1994. The stake, worth about $283.142m, was owned by the government. Mikhail Khodorkovsky, the former chief executive of YUKOS and the main shareholder in the company, was arrested in Novosibirsk on October 25, 2003 and taken to Moscow, at the request of the Prosecutor General’s Office of Russia. He is accused on eleven counts (under seven articles of the Russian Criminal Code). Vasily Shakhnovsky, another co-owner of YUKOS and the former President of YUKOS-Moscow, is also facing criminal charges. Mr. Shakhnovsky is accused of evading RUR 53m in taxes. He has already paid damages to the government. According to the Prosecutor General’s Office, international arrest warrants were issued for ten people in connection with the YUKOS case. Among them are major shareholders of YUKOS, such as Leonid Nevzlin, Vladimir Dubov and Mikhail Brudno. They are accused of tax evasion and a number of other crimes.

On November 28, Sibneft announced that the deal had been suspended. Sibneft owners suggested signing a reverse deal, under which YUKOS would return its 92 percent stake in Sibneft. The two companies continue talks to settle the situation. YUKOS, now the main shareholder in Sibneft, called an extraordinary general meeting of Sibneft to replace the Sibneft Board of Directors and change the company’s articles of association. The meeting is scheduled for March 28, 2004.