Glencore Scraps Planned Sale of $9 Billion Stake in Russian Oil Company
05 Maio 2018 - 12:13PM
Dow Jones News
By Chip Cummins in London and James T. Areddy in Shanghai
Mining giant Glencore PLC and Qatar said they have scrapped
plans to sell a roughly $9 billion stake in Russian state oil
company PAO Rosneft to a once-high-flying Chinese firm now
embroiled in investigations by Beijing.
In a statement late Friday, Glencore and Qatar said they were
terminating an agreement, reached in September, to sell most of
their roughly one-fifth stake in Rosneft to CEFC China Energy Co.
The deal was intended to provide CEFC with just over 14% of Rosneft
and would have strengthened energy ties between Moscow and
Beijing.
The agreement with the Chinese buyer was the latest in a series
of moves undertaken by Glencore, the state-owned Qatar Investment
Authority and the Kremlin over the stake. In late 2016, as low oil
prices pressured Russian finances, Moscow agreed to sell a 19.5%
stake to Glencore and the Gulf emirate's investment fund for about
$11.3 billion.
The exact terms of that complex deal were never straightforward.
It gave Glencore an actual equity stake in Rosneft of only about
0.5%, and Qatar just under 5%. The rest of the deal was financed by
Russian banks and Italy's Intesa SanpaoloSpA, which had planned to
spread its risk by syndicating the loan to other banks.
The partners then struck a deal to unload their holdings with
private energy-trading company CEFC, which appeared at the time to
be a fast-growing investor with global ambitions and Beijing
backing. CEFC, founded in 2002 and based in Shanghai, has been
expanding internationally in recent years.
Earlier this year, though, whatever official support CEFC
enjoyed appeared to be crumbling. In March, The Wall Street Journal
reported Ye Jianming, the company's leader, was under investigation
in China. Mr. Ye, who made his early fortune as an oil man, was
seen to have close ties to China's military and intelligence.
Mr. Ye's whereabouts are unknown. Since his disappearance, banks
have called in credit lines, and CEFC has sought to raise money in
China. CEFC has been unable to complete some of its biggest plans,
including a major expansion in the Czech Republic, the purchase of
around 20% of New York financial-services firm Cowen Group Inc. and
the purchase of a Portuguese insurer. CEFC couldn't immediately be
reached.
All that put the fate of a sale of the Rosneft stake in doubt.
Late Friday, Glencore said it and the Qatar fund had terminated
their deal with CEFC and dissolved their own partnership agreement.
Glencore said the two would subsequently each hold their respective
equity stakes in Rosneft separately.
A subsidiary of the Qatar fund would take ownership of roughly
14% of Rosneft, giving the fund an overall 18.93% stake in Rosneft.
Glencore, meanwhile, will exit with 0.57%. Exact financial terms
between the partners and the banks involved weren't disclosed.
Glencore said it would receive 3.7 billion euros, or $4.43
billon, in the transaction. A person familiar with the matter said
the cash would be used to pay back debt that helped finance the
original deal. It was unclear whether Glencore Chief Executive Ivan
Glasenberg would remain on Rosneft's board.
Representatives for Qatar couldn't be reached immediately for
comment.
--Scott Patterson in London contributed to this article.
Write to Chip Cummins at chip.cummins@wsj.com and James T.
Areddy at james.areddy@wsj.com
(END) Dow Jones Newswires
May 05, 2018 10:58 ET (14:58 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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