MOSCOW, April 18 (RIA Novosti) - State-owned oil company Rosneft will boost its capitalization by $10 bln by transferring all the assets and licenses of its subsidiaries to itself by the end of November, the company's president said Tuesday.
"The goal of the Rosneft reorganization is the logical conclusion of the process of forming a single vertically integrated company and turning it into a world-class oil and gas company," a Rosneft press release said, adding that the company would be able to reduce expenditure and increase its management effectiveness as a result.
Rosneft President Sergei Bogdanchikov said at a meeting with President Vladimir Putin that a decision to consolidate the subsidiaries had been made at a meeting of the directors of Rosneft and its subsidiaries on Monday.
Bogdanchikov also confirmed that Rosneft, Russia's largest state-owned crude producer which estimates its current value at more than $25 billion, would sell its stock in Russia and on the London Stock Exchange. The company could float up to 30% of its stock, which would be the nation's biggest IPO to date.
Economic Development Minister German Gref said last week that the IPO was slated for the third quarter of the year and that funds raised through the placement would go to repay a $7.5-billion loan taken to buy a 10.74% stake in Gazprom in order increase the state's share in the energy giant to a controlling block.
In 2004, Rosneft borrowed $6 billion to acquire Yuganskneftegaz, the main production unit of embattled oil company Yukos, which was returned to the state as payment on the oil firm's multi-billion back tax bills and re-sold to Rosneft. Media reports at the time said the money had come from China, and the deal had been brokered by the Russian state-controlled Vneshekonombank and secured by pledging future oil supplies to China.
According to Rosneft's U.S. GAAP financial statement for the first nine months of 2005, the company will also have to pay the remaining $455.1 million and $655.7 million of the loans secured on Yuganskneftegaz by its former parent company. Rosneft promised in an agreement to pay the debts to Paris-based Societe Generale, which led a syndicate of Yukos' creditor banks, by June 30, 2006.
Rosneft has increased its stake in Yuganskneftegaz's charter capital from 50% to 76.79%. It now also holds 100% of common shares in Yuganskneftegaz.
The consolidation of Rosneft and its subsidiaries will be completed by November, the company said Tuesday.
Rosneft's plan envisages the consolidation of 12 of its assets, including Rosneft-Krasnodarneftegaz, Rosneft-Purneftegaz, Rosneft-Sakhalinmorneftegaz, Rosneft-Stavropolneftegaz, Yuganskneftegaz, Severnaya neft, Selkupneftegaz, Rosneft-Komsomolsk NPZ (Komsomolsk Refinery), Rosneft-Tuapse NPZ (Tuapse Refinery), Rosneft-Arkhangelsknefteprodukt, Rosneft-Nakhodkanefteprodukt, and Rosneft-Tuapsenefteprodukt.
Rosneft and the companies involved will each hold general shareholders' meetings on the consolidation plans on June 02, the company said.
Rosneft plans to propose to its minority shareholders to convert their shares into the consolidated company's shares, or to sell them in accordance with Russian regulations.
