Rosneft and bp. Rosneft completed the deal of the year by acquiring TNK-BP. Return to the Arctic ...
The CEO of TNK-BP, in his office, together with his deputy, Maksim Barsky, watched a news release on TV. On the screen, Russian President Vladimir Putin, BP CEO Robert Dudley, Deputy Prime Minister and Chairman of the Board of Directors of Rosneft Igor Sechin and Rosneft President Eduard Khudainatov signed an agreement on a global strategic alliance. After the deal, Rosneft was to become the owner of 5% of the shares of one of the largest oil companies in the world in exchange for 9.5% of its shares. The partners also agreed to create a joint venture to operate on the Arctic shelf.
“Well, let's go to court,” Fridman said to Barsky, having examined the news. The shareholder agreement between the owners of TNK-BP - British BP and the AAR consortium (Alfa Group, Access Industries, Renova) - implied exclusive work in the Russian oil market without the participation of third parties. “How to go to court? - Barsky was surprised. “We live in Russia, they can take everything away!” “Well, what can we do, then we’ll fight,” Friedman shrugged his shoulders.
"Alpha" is no stranger to suing. And two months later, the Stockholm Arbitration Court banned the BP-Rosneft deal. This put an end to the already tense relations between the Russian and British owners of TNK-BP. On March 21, 2013, Rosneft acquired TNK-BP and became the world's largest publicly traded oil and gas company in terms of production and reserves of raw materials.
Organized by the "deal of the century" Sechin, who left the government in advance and headed "Rosneft". The purchase of TNK-BP took place at the peak of oil prices: the state-owned company paid a record $ 56 billion for its greatness. Now that energy prices have collapsed, the entire Rosneft is worth $ 46 billion - less than AAR and BP received. Friedman and the company invest the proceeds from the sale mainly abroad. So far, they have invested $ 5.7 billion in the oil sector - in March 2015, they bought the German oil company Dea.
Igor Sechin and Mikhail Fridman have radically different approaches to life, business, and the state. Take oil prices. We need to get used to low oil prices, Friedman wrote in his article for the Financial Times. Prices will rise yet, you just have to wait, Sechin retorted in the same publication. Which of them won?
Friedman's mistake
Sechin and Fridman are absolute antipodes, although both have a huge impact on the Russian economy and both wanted to become a part of the global economy, only in different ways, says their mutual friend. Friedman has long had ambitions to become an international businessman. This could have happened if he had exchanged his Russian oil assets for a stake in some global company, such as BP. Two businessmen familiar with Friedman told Forbes that even Putin allegedly supported his intentions with regard to BP, because Russian investments in the West could be an instrument of political influence.
But Friedman made a global mistake - back in the 2000s, he spoiled his relationship with Robert Dudley, the future CEO of BP, and closed his way to BP, without knowing it, explains one of Forbes' interlocutors.
In the 1990s, BP came to Russia and behaved like a colonizer. This is how global oil and gas giants behave in any third world country, but in Russia they did not succeed with this approach, recalls a former TNK-BP employee. “They thought that if they had agreements with the government, they could develop without problems. But it didn’t work: there were problems with Russian partners on a regular basis, ”he emphasizes. At the same time, BP still viewed Russia as an important market. She needed a partner with a lobbying resource. The Alfists, hardened in the battle for oil assets, in turn, needed an international investor. “It was some kind of insurance against a hostile takeover by the state, and it worked,” says Ivan Mazalov, head of the representative office in Russia of Prosperity Capital Management, one of the largest minority shareholders of TNK-BP. In 2003, Alfa, Access Industries, Renova, on the one hand, and BP, on the other, merged their assets into TNK-BP.
There have always been disagreements after the creation of the company, recalls a former TNK-BP employee. Development plans, what assets to acquire, what to invest in, and what not - any question became a battlefield. They even argued about dividends: before the accident on the BP drilling platform in the Gulf of Mexico in 2010, the British often proposed cutting dividends in favor of investments. After the accident, BP urgently needed money, and the situation changed exactly the opposite.
Traditionally, BP has had a stronger influence over the company. And although the ownership was parity, and the shareholders were equally represented on the board of directors, the position of CEO was assigned to BP in the shareholder agreement. The head of TNK-BP, Robert Dudley, is described by people who knew him during his work at the Russian-British oil company as an “intelligent, adequate, positive” person. A real democrat: he went with everyone in the elevator, recalls one of the former employees. But the last year of his work in the company, 2008, was especially difficult, Russian shareholders literally squeezed Dudley out of the company in order to gain more influence on management.
Harassment, searches, visa refusals - Dudley confessed to his inner circle that, against the background of everything that was happening, he began to think that behind his back the employees were laughing at him. At one time, Dudley even had to manage the company from some secret place. The conflict between AAF and BP was publicly commented on by Putin. He said that he had warned TNK-BP shareholders about possible problems when the company was just being created: the 50/50 parity structure does not work. “Agree among yourselves so that one of you has a controlling stake. We don't mind it being BP. We will support if it is the Russian part of the joint venture - TNK, but there needs to be an owner, and when there is no clearly expressed authority, there will be problems in such a structure, ”he said on May 31, 2008 in an interview with French Le Monde.
Dudley eventually left TNK-BP. And BP itself began to think about leaving Russia, assures a Forbes source in Rosneft. “In fact, in many ways, the fact that Rosneft later acquired TNK-BP was the only way to keep BP in Russia,” he says. But this was not the determining factor in BP's relations with Russia. Dudley was named one of the contenders for the post of CEO of BP back in 2006, but the post went to Tony Hayward as a result. And when, after the accident in the Gulf of Mexico in 2010, Hayward left, Dudley who took his place wanted to somehow respond to his offenders from Russia, says one of Forbes interlocutors: “As soon as Dudley headed BP, for Friedman, no matter what he was. imagined, the prospect of any deal that would make him a shareholder in BP was closed - Dudley simply would never have allowed that. "
Sechin's ambitions
Dudley signed an "Arctic" deal with Rosneft, absolutely deliberately violating the shareholder agreement with AAR on TNK-BP, according to one of Forbes' interlocutors. In his opinion, the head of the Verkhovna Rada perfectly saw Sechin's ambitions and played on his desire to "crush everything around him." Maxim Barskiy, who today heads Matra Petroleum, told Forbes that prior to the signing of the agreement with Rosneft, Dudley flew to Moscow several times and met with the management of Rosneft behind the back of Russian TNK-BP shareholders.
On the day the deal with Rosneft was signed, Dudley visited the office of his Russian partners in TNK-BP. Alfa's co-owner German Khan and Barsky met with him. By this time, they already knew about the impending deal, but Dudley did not suspect about it. “And so Dudley told us that he was going to exchange shares with Rosneft. "Do you mind?" - "No, - we answered, - not against." And not a word about the Arctic. Then I could not resist and say to him: "Well, you do not want to tell us anything about the Arctic?" He replied that nothing was known yet. And so he left us, and in the evening he signed this agreement with Rosneft, "Barsky recalls.
Friedman was not joking when he threatened Dudley with trial after watching the news on TV. At that time, he served as CEO of TNK-BP, the legal department of the company was completely under the control of Russian shareholders, and this legal department smashed British lawyers in court. The main argument was the fact that BP did not offer TNK-BP to participate in the “Arctic” deal with Rosneft. “If they had offered, we would have agreed, because it was a very promising story at the time,” says Barsky.
After the decision of the Stockholm Arbitration, BP was forced to offer TNK-BP to take part in joint work in the Arctic. After that, TNK-BP's board of directors constantly met and discussed whether to go with BP and Rosneft to the Arctic. Four representatives of the AAR were in favor, recalls Barsky, and four representatives of BP on the board of directors reasonably remarked: “What do you understand in the Arctic, you will not be able to work there”. One of the independent directors, Alexander Shokhin, was on the side of the AAF, the second, James Leng, was on the side of BP. The decisive vote was the vote of the third independent director - former German Federal Chancellor Gerhard Schroeder, and the parties fought for him, recalls Barsky.
Schroeder really found himself in a difficult situation and was waiting for a political signal. In one of the interviews, Putin was again asked about the conflict in TNK-BP, and he replied that all disagreements must be resolved according to the shareholder agreement. For Schroeder, this was a signal - and TNK-BP voted to participate in the project. The deal between Rosneft and BP, in fact, collapsed immediately, recalls Barsky. Rosneft needed BP's offshore technology, but not a hectic partnership with Alfa.
The Stockholm Arbitration Tribunal allocated two months to settle all controversial issues on the "Arctic" deal, otherwise it would simply not have taken place. Rosneft had only a few days left, and then Sechin suggested that the AAR consortium sell its stake in TNK-BP, although initially this option was not considered at all. A day before the expiration date, Friedman had a ransom offer on his desk, which generally suited AAR. But Sechin set a condition: first, AAR must withdraw the claim from the Stockholm Arbitration and only then sign documents on the sale of a stake in TNK-BP. Friedman proposed the reverse procedure.
“It was a key moment. Igor Ivanovich then said: the Deputy Prime Minister is in front of you, I give you my word, go and take [documents from the Stockholm Arbitration Court], there are only 24 hours left, ”recalls an eyewitness to those events. There were disagreements within the AAF on this matter, "after all, not everyone's nerves are as steel as Friedman's." As a result, the consortium supported Friedman's position, and none of the deals took place. In June 2011, in an interview with The Wall Street Journal, Sechin said that the main loser in the situation with the cancellation of the "Arctic" deal is the AAR, that the question is not about “revenge or punishment” of the AAR, and wished them “every success”.
And although the conflict between Russian and British shareholders did not end there, it was the dispute over the Arctic that laid the foundation for the future "deal of the century": the unstable "50-50" structure has finally outlived its usefulness. Due to the ongoing corporate conflict, TNK-BP was practically paralyzed, and someone had to leave. For almost two years AAR, BP and Rosneft discussed who would leave and on what terms. In October 2012, Igor Sechin reported to Putin that the state-owned company was buying out all of TNK-BP, and BP was becoming a shareholder in the merged company. The President approved this plan.
Help for traders
Friedman is a businessman to the core: cold, calculating, cynical. Many people familiar with him note his clairvoyance and intelligence. He always emphasized that he was engaged exclusively in private business and avoided, for example, the sphere of state orders. Friedman, who is not closely associated with state-owned companies and political figures, however, always speaks of the authorities with respect. And Sechin was an effective deputy prime minister, made decisions in the interests of the state, very correct decisions, says one of the acquaintances of the president of Rosneft. Sechin equated Putin's will, state security, and the public good. Much has changed since the purchase of TNK-BP.
In the spring of 2015, Bloomberg, citing sources from among the advisers to the President of Russia, wrote that a crack was outlined in the relationship between Vladimir Putin and Igor Sechin, allegedly due to huge debts of Rosneft, constant requests for state support and tax benefits, as well as due to the collapse of the exchange rate ruble after the placement of the company's bonds in December 2014. And although there is no real evidence of Sechin's disgrace, the fact remains that Rosneft has huge debts, and it itself costs less than it once paid for TNK-BP.
“The company's capitalization is an unrepresentative indicator, especially in Russia and especially in the current environment. It reflects country risks to a greater extent than the state of the company. It is necessary to evaluate the company according to fundamental indicators, - emphasizes the vice-president of Rosneft Mikhail Leontyev. - And this is not only the volumes of production and reserves, but also qualitative indicators: production costs, debt burden. Rosneft has now returned to the level of its debt burden, which was before the purchase of TNK-BP. " Before the deal, Rosneft's debt to EBITDA ratio was 1.17, and at the end of Q3 2015 (latest data for March) - 1.61 in rubles and 1.27 in dollars. The large foreign currency debt, as the company itself has repeatedly noted, is regularly paid off. This is true, but there are nuances.
Rosneft's net debt at the end of the third quarter of 2015 was $ 24.5 billion, the total debt was $ 47.5 billion. This is excluding pre-export financing - Rosneft does not include it in the total debt. Therefore, the real debt burden is much higher. In the III quarter of 2015, Rosneft showed in its financial report that it received almost 1 trillion rubles from the “world's largest oil trading companies”, or approximately $ 16 billion. What are we talking about? It all started with the purchase of TNK-BP.
The world did not have enough money to buy TNK-BP, a former employee of one of the global oil traders sneers. In November 2012 - February 2013, Rosneft borrowed $ 31 billion from foreign banks and placed Eurobonds for $ 3 billion. About $ 10 billion was missing. This money in the form of pre-export financing for Rosneft was provided by the world's largest traders Glencore and Vitol in exchange for the supply of 67 million tons of oil over five years: Glencore - 46.9 million tons and Vitol - 20.1 million tons. The seller and buyers did not disclose the value of the contracts, but with prices over $ 100 per barrel, such a volume of oil would cost at least $ 49 billion ...
A former employee at one of the trading companies says that traders did receive a significant discount to the market price. Oil supplies and redemption of pre-export financing are carried out through specially created companies (SPVs) Ros-GIP (Glencore) and Ros-Vit (Vitol) - both companies are included in the rating of the largest buyers of Russian oil (see page 233). It was by structuring the TNK-BP purchase that Rosneft tested a new way of working with traders.
In June 2013, Rosneft signed a similar contract with Trafigura with an advance payment of $ 1.5 billion and the supply of 10 million tons of oil over five years. In February 2015, another contract was signed, the terms of which are unknown, but the volume of supplies for it exceeds 15 million tons, and the prepayment allowed Rosneft to pay more than $ 7 billion in debt repayment against the backdrop of US and EU sanctions. Similar agreements were signed with China's China National United Oil Corporation (subsidiary of CNPC) and Tonner S.A.R.L.
On September 7, 2015, at a conference in Singapore, Igor Sechin, seeing Jonathan Kollek, the former vice president of TNK-BP and now the head of Trafigura Eurasia, kissed him on both cheeks, which the Financial Times saw as evidence of the deepest ties between the Swiss oil trader and the Kremlin oil worker. Indeed, Rosneft is highly dependent on its traders.
The fall in oil prices has forced the company to ramp up supplies under pre-export finance contracts and sometimes cancels regular sales tenders. If you violate the terms of pre-export financing, the trader can demand export proceeds from the company. Thus, almost all of Rosneft's oil has already been contracted and paid for several years in advance, says one industry source. However, another interlocutor of Forbes notes that “maybe under a different head, Rosneft would have gone bankrupt long ago, but it works”.
An interesting detail: in November 2015, Alfa-Bank acquired a share ($ 150 million) in a syndicated loan from Ros-GIP and Ros-Vit, which is secured by oil supplies from Rosneft, from a syndicate member, Morgan Stanley.
Did Friedman find a use for the money received for TNK-BP?
Immediately after the sale of TNK-BP, he said that he would invest in those sectors that were of interest to him earlier: the fuel and energy complex, telecommunications, retail, and the banking sector. And all further investment activities of Fridman showed his interest exclusively in international projects. In June 2013, LetterOne Group, an investment corporation controlled by Alfa Group, announced the creation of L1 Energy to invest in the international oil and gas sector. Herman Khan was appointed chief executive officer of L1 Energy, ex-head of BP Lord John Brown and head of AAR Stan Polovets entered the advisory board.
Already in November 2013, the company announced its interest in the oil and gas assets of the German RWE - the Dea company. Only a year and a half after fighting the British authorities who did not want to approve the deal, Friedman closed the deal to buy the assets. At the same time, he had to sell shares in the fields in the North Sea, which are under the jurisdiction of Great Britain. The British government never approved of Friedman's work on these projects. Dea, however, still has gas storage facilities in Germany, as well as projects in Norway, Denmark, Algeria, Libya. In Egypt, Friedman, after acquiring Dea, received a joint project with BP (in a ratio of 35% to 65%), but later L1 announced the sale of a stake in this project. On the basis of Dea, Friedman plans to develop an international oil business: in December 2015, Dea bought E.ON's assets offshore Norway for $ 1.6 billion, and also announced plans to work in Mexico, South America, Iran and Brazil.
Dea L1 spent only a small part of the money it received for TNK-BP on the purchase, as it attracted loans. L1 invested about $ 4.5 billion in the Pamplona funds of Alex Knaster, a former partner of Alfa Group, spent about a billion on the purchase of student dormitories in the UK, $ 200 million on the purchase of Uber shares. The rest of the money is managed by a special treasury, the funds are placed on bank deposits and in risk-free securities, said a source close to Alfa.
Newspaper controversy
In early 2015, Fridman and Sechin, literally two weeks apart, published articles in the Financial Times and presented their vision of the oil market. Their positions were radically different: Sechin was a follower of the concept of "peak production", and Fridman - "peak demand". Fridman's Reflections on Oil were published on January 28, and Sechin's on February 15, which made readers feel as though Sechin had decided to respond to Fridman's article. However, Forbes found out that the Financial Times did not immediately publish Sechin's article, although it was sent "strongly in advance" and was initiated, in fact, by the author himself.
Sechin explained the fall in world oil prices by the fact that market pricing had come under the control of speculators and manipulators. He expressed confidence that the demand for oil in the world is still huge. According to Friedman, prices depend on the perception of the market by the players: before, everyone believed that there were not enough oil reserves in the world, and now they are switching to new technologies and replacing oil with renewable energy sources. The businessman stressed that he is "not a professional oilman" and his reasoning is based on the fact that "a person will always find a way to get around an obstacle on his way."
Sechin promised a slight increase in prices by the end of the year, and further recovery to $ 90-110 per barrel, because expensive oil production projects will be frozen during a period of low prices. Friedman is convinced that the world has entered a prolonged period of low oil prices, which will increase the efficiency of companies and reduce the influence of lobbying in the oil sector. According to the businessman, countries with market economies and protected rights to private property are mainly interested in energy innovations. Sechin agrees with him on this: he writes that the strengthening of regulation on the market is unnecessary and only "worsens the state of affairs."
Sechin's perception of the global oil market may have been influenced by Daniel Yergin, author of the well-known work "Production: A World History of the Struggle for Oil, Money and Power." The book was published in Russia twice, the second edition - in 2011 with the sponsorship of Rosneft. “The book will help oil workers uncover the main processes of the industry, its driving forces, and better predict the future,” Sechin wrote in the foreword. However, Ergin's forecasts did not come true.
The expert was skeptical about the "shale revolution", considered oil a product of the future and expected a long period of high oil prices. This directly echoes Sechin's article, where he writes that "the world needs oil." As Kommersant wrote, Sechin read Yergin's book in 2004 and "enthusiastically retelling the stories described in it." Then he met the author and hired him as a consultant for the government and Rosneft. “I think that Ergin deliberately or unconsciously misled Sechin with his theory of peak production, and now we have what we have: Rosneft with debts amid low prices,” says one of Forbes interlocutors. A source in Rosneft does not agree with the complete coincidence of the views of Sechin and Yergin. "Yergin's position is undoubtedly tailored to the United States and its interests in the oil market, while Sechin's - to Russia and its interests," he notes.
Did Friedman foresee that oil prices would fall so much when he sold TNK-BP? Unlikely. Several of his acquaintances tell at once that he did not want to sell the company. But lucky, as they say, the strongest.
Image caption TNK-BP was the third largest oil producer in Russia
The state-owned company Rosneft completed the purchase of 100% of TNK-BP from British BP and thus became the world's largest publicly traded oil and gas company in terms of production and hydrocarbon reserves.
BP announced the possibility of selling its stake in TNK-BP in June 2012.
Earlier, TNK-BP's securities were equally owned by British BP and a consortium of Russian shareholders AAR (Alfa Group, Renova, Access Industries). Rosneft bought the AAR stake for $ 27.73 billion.
Now BP has received $ 16.65 billion for its stake and 12.84% of Rosneft shares. In addition, BP acquired an additional 5.66% stake in Rosneft from Rosneftegaz.
According to a press release from Rosneft, BP became the second largest shareholder of the Russian company as a result of the deal, with a 19.75% stake. In addition, the president of the BP group of companies, Robert Dudley, has been nominated for election to the board of directors of the Russian oil giant.
"Flock of cats"
Before that, Rosneft was the largest company in Russia in terms of oil production. It included 17 mining and 16 processing enterprises.
Igor Sechin previously told Russian President Vladimir Putin that in 2013 the revenues of the combined Rosneft and TNK-BP are expected to reach 4.9 trillion rubles ($ 160 billion).
Sechin said he would personally take care of TNK-BP's management, answering a question from journalists on Thursday about who will lead the company.
"Don't you like my candidacy?" - said the president of Rosneft, Interfax reports.
"This is not a mergers and acquisitions, this is the world's largest economic acquisition transaction. Whoever buys, controls," he added.
"Congratulations on the completion of the deal," Russian President Vladimir Putin said at a meeting with BP CEO Robert Dudley, in which Igor Sechin also attended.
The head of BP said that there are certain difficulties in working with Russian partners. “They can be pretty tricky at times; as we put it, it's like dealing with a bunch of cats - no one knows who's in charge or what they're going to do," Dudley said. process; I think we practically got out of it. "
Here is what I wrote about five years ago in this book: “We should admire the resilience of the proud Britons. They really want to stay on our oil and gas market, they want to influence it so much, and through this they want to influence Russia's foreign policy. But it won't work. The difficulties of TNK-BP did not end there. And sooner or later, the British oil monopoly will be squeezed out of Russia, and its oil assets will be sold to a Russian company. “This is bad for us, bad for the company and, of course, very bad for Russia,” says Peter Sutherland, Chairman of the Board of the British oil giant, assessing the developing events. And the author of this book thinks that, on the contrary, is good. Very good. Control over the main resource of the planet, over the main resource of his country in the hands of his government - is it good or bad? Answer this question yourself. "
And finally, the British are being squeezed out of TNK-BP. They are squeezed out gently, in Putin's way. But persistently and relentlessly. The private company TNK-BP is being bought out in full from its shareholders by the state company Rosneft.
“Earlier today it became known that the oil company“ Rosneft ”is buying out 100% of TNK-BP shares from the consortium AAR and the British oil company BP. The head of Rosneft, Igor Sechin, announced the signing of the corresponding agreement. ".
Does this mean that control over a large part of our subsoil is returning to the hands of the Russian state? Yes it is.
Let's take a look at the convoluted scheme of buying and selling oil assets.
First, let's make sure that Rosneft is indeed a state-owned company.
We go to the company's website, read:
Equity structure
The composition of shareholders (shareholders) of Rosneft Oil Company owning more than 1% of the authorized capital of the Company as of October 1, 2012
1. 75,16% owned, which is 100% federal property.
2. More 9,53% belongs to LLC RN-Development, which in turn belongs to LLC RN-Trade, whose members are OJSC NK Rosneft (99.9999%) and LLC Neft-Aktiv (0.0001%), 100% controlled by OJSC NK Rosneft. That is, Rosneft itself controls the company, which owns 9.53% of its shares. This means - and this interest belongs to the state.
3. The company itself, OAO NK Rosneft, has on its balance sheet, that is, it owns 3,04% "Itself".
This is where the state participation ends. 10,19% which belong to "Sberbank" cannot be attributed to state assets, since the owners of the controlling stake in "Sberbank" are. We are not interested in other individuals and legal entities either.
So: 75.16% + 9.53% + 3.04% = 87.73% of Rosneft belongs to the state.
Now we are looking at the conditions on which our British "friends" agreed to give TNK-BP shares to Rosneft.
". Upon completion, BP will receive an 18.5% stake in Rosneft and $ 12.3 billion in cash. Taking into account BP's 1.25% stake in Rosneft, BP's share in the share capital of the Russian company will amount to 19.75%. ”
So, in order for the British to lose 50% of the shares of the third largest oil company in Russia, we give them 18.5% of Rosneft.
As a result, control remains completely in the hands of Russia: we will have 69.23%, British Petroleum -19.75%.
Of course, we would like our British partners to have a share in the depths of Russia equal to zero point zero. But politics is the art of the possible. Not the art of the desired. The British are removed from control over the subsoil, giving them only a piece of the oil pie. They clean up, after eight years of FIGHT with them for it!
(Just type in the search engine "TNK-BP" and the word "problems" and you will read how many difficulties and accidents had to be done to "convince" BP to give up TNK-BP shares).
Now the conclusions that suggest themselves from all of the above.
No further privatization of Rosneft should take place. Otherwise, you can lose control over this vital company. Talk about privatization, smile, but postpone it all the time and never carry it out.
The strategic line of the Russian leadership towards gaining full sovereignty is complete control over Russian mineral resources. But first - the complete rearmament of the army and navy, the development of a new state patriotic ideology. And only then at the negotiating table with our British "friends" - with new trump cards.
Demanding today "to drive the British with a filthy broom" from our oil industry is a complete lack of an adequate assessment of today's geopolitical reality. This is the same as demanding that Stalin send the Third Reich away in August 1939, instead of signing a Non-Aggression Pact with him. Only "Svanidze" are capable of this ...
As long as "they" are stronger - you need to negotiate.
This is the main art of a politician and head of state.
Unofficial information that the deal could be closed on March 21 appeared in the morning. As a result, according to Rosneft, the redemption of shares was completed at 15:53 Moscow time. The deal was carried out simultaneously in several points of the Earth (Caribbean Islands, Cyprus, Europe), including in offshore zones. Control over TNK-BP passed completely to NK Rosneft.
Rosneft paid out $ 27.73 billion to the Russian shareholders of TNK-BP, which owned 50% of the company - the consortium of Alfa Group, Access Industries and Renova Group (AAR). The co-owner of AAR has already announced that most of this money will remain in At the same time, AAR Chief Executive Officer Stan Polovets noted that "the deal to sell a stake in TNK-BP opens up opportunities for participation in new large-scale projects in Russia and abroad."
As for BP, the former owner of the remaining 50% of the Russian-British joint venture, it received 12.84% of Rosneft shares and $ 16.65 billion in cash (including dividends of $ 0.71 billion received by BP in December 2012, the total amount reached the previously agreed-upon - $ 17.12 billion). At the same time, BP directed $ 4.87 billion to acquire 5.66% of Rosneft shares from Rosneftegaz. As a result of all these transactions, BP received $ 12.48 billion and, taking into account its 1.25% stake in Rosneft, BP became the owner of a 19.75% stake in NK Rosneft.
It also became known that the head of R. Dudley joined the TNK-BP integration committee, headed by the president of the Russian state oil company. As previously reported, according to the order of the government of the Russian Federation, R. Dudley was also nominated to the board of directors of Rosneft as a representative of the state.
A wall behind Rosneft
Commenting on the deal, I. Sechin stressed that "he welcomes BP as a shareholder of Rosneft, which through representation on the board of directors will participate in shaping the company's strategy." "We hope that BP's extensive experience will allow us to maximize the synergetic effect in a number of areas during integration," Sechin said. He expressed his conviction that the transition to a new level of relations will bring benefits not only to Rosneft and its shareholders, but also to the Russian oil industry as a whole. Thus, according to I. Sechin, after the purchase of TNK-BP, Rosneft intends to strengthen the exploration and production block. "We are strengthening the exploration and production unit. For the first time, the chief geologist of the company appears," he told reporters.
In turn, R. Dudley expressed the opinion that today has become "historic for BP in Russia." He stressed that BP has been working in Russia for over twenty years, and over the past ten years has been the largest foreign investor in Russia through its participation in TNK-BP. "We are focused on building on this success thanks to today's deal, which increases our stake in Rosneft and gives us an excellent opportunity to build new partnerships with the largest Russian oil company," Dudley said.
We also note that I. Sechin and R. Dudley took part in the meeting with the President of the Russian Federation, who congratulated the participants in the transaction on its completion and wished them success. "The deal was large, complex, multifaceted, very large in volume. This, as I understand it, is the largest direct purchase and sale deal in the world economy today," Putin said. He called BP's acquisition of shares in Rosneft "a very important step in the privatization of state property."
R. Dudley, answering V. Putin, noted that the sale of a stake in TNK-BP was "a very interesting adventure." “We really liked it, and it was very good for us to work with Igor Ivanovich (Sechin. - RBC note) and with the entire Rosneft team,” R. Dudley emphasized. “We are very pleased that we will become the second most important shareholder of Rosneft. , we are very supportive, we stand a wall for this company, we have come seriously and for a long time, and if suddenly any rumors circulate that we want to sell shares, do not believe these rumors, please, "the head of BP assured the Russian president ...
A huge amount of work has been done to successfully complete this transaction. As a result, a whole team of managers headed by I. Sechin managed to carry out one of the most elegant deals of our time - to buy out 100% of TNK-BP shares at a time.
Skydiving
Immediately after the announcement that the sale of TNK-BP was completed, a number of key top managers announced their departure from the company. In particular, the company was left by its former co-owners Herman Khan and. Jonathan Muir, Chief Financial Officer of TNK-BP, and Mikhail Slobodin, Executive Vice President, also announced their resignation from TNK-BP. Earlier there was unofficial information that the top management of TNK-BP in case of dismissal will receive "golden parachutes" in the amount of two annual salaries, but so far neither Rosneft, nor AAR, nor TNK-BP have officially commented on this.
Cheap buy
Talking about the terms of the deal to buy TNK-BP, an analyst with FG BCS Vladislav Metnev told RBC that "this is one of the best deals in the history of the Russian oil sector." Rosneft made good use of the conflict between shareholders and was able to offer a reasonable way out of the conflict for both AAR and BP. In turn, the structure of the deal helped BP maintain its presence in Russia, and AAR helped monetize this asset, "V. Metnev points out. Veles-Capital analyst Vasily Tanurkov calls the deal" very, very profitable "for Rosneft." Rosneft "bought TNK-BP with borrowed money, and very cheap - we are talking about 3.25-3.5%. TNK-BP brings in a year, conditionally, about 7-8 billion dollars. profit, and paid 56 billion for it That is, relatively speaking, it turns out that we took the money at 3.5% and placed it at 12-15% yield, "says V. Tanurkov.
He emphasizes that TNK-BP is one of the most efficient Russian oil companies. “Its profitability has historically been at its maximum levels for the industry, production growth continued quite well. In fact, the investment is simply brilliant,” the expert concludes.
Perspectives
According to V. Tanurkov, "from the point of view of the investment attractiveness of Rosneft for foreigners, the fact that BP has become one of the largest shareholders plays a very positive role." "Still, the main stake belongs to the state, but since the gradual privatization of Rosneft is planned, in the future, apparently, it may turn out that BP will become the largest shareholder in general. This, naturally, attracts foreigners," V. Tanurkov said. V. Metnev believes that an increase in BP's share may lead to an increase in the level of corporate governance in Rosneft, "at least at the level of making major decisions in relation to investment programs, in relation to the company's development strategy."
Regarding the possibility of further increasing BP's stake in Rosneft, he believes that "BP would like to receive a blocking stake, but it does not appear that this is one of the desired scenarios of the main shareholder of Rosneft, represented by Rosneftegaz, the Russian authorities." Uralsib Capital analyst Alexei Kokin believes that BP is likely to get two seats on Rosneft's board of directors. The expert also hopes that thanks to BP, Rosneft "will finally have a development strategy." The analyst notes that by the end of the year the company can formulate its strategy together with BP.
Alexander Razuvaev, director of the analytical department of Alpari, emphasizes that the combined company will produce about 4 million barrels. per day, reserves will amount to 28 billion barrels, the estimated sales volume - 160 billion dollars, EBITDA - 32.9 billion dollars. At the same time, I. Sechin, at a meeting with V. Putin, expressed his assessment of the prospects for the merged company. "According to the updated data, production in 2013 will amount to over 206 million tons of oil, gas production - 47 billion cubic meters, refining - 95 million tons. Revenue will amount to 4.9 trillion rubles. ) ", - said the head of Rosneft. He estimated the possible synergies from the merger of up to $ 10 billion.
V. Tanurkov from Veles-Capital finds it difficult to estimate the size of the possible synergetic effect, recalling that earlier estimates were made at the level of $ 3-5 billion. At the same time, he is sure that the effect will be "very significant." "It is clear that it will be at least at the expense of transport and administrative costs," the analyst points out.
At the same time, V. Tanurkov and A. Razuvaev compare Rosneft, which has grown after the purchase of TNK-BP, with Gazprom. "New Rosneft is becoming very similar to. The only exception is that the transportation of raw materials in Russia is still separated from production, which, from our point of view, is more correct," A. Razuvaev points out. In his opinion, "" must be left independent. "The merger of two state-owned companies (Rosneft and Transneft), from our point of view, is a very bad idea. At the same time, Rosneft is a much more transparent and efficient company than Gazprom, which means it deserves a premium in the assessment," A. Razuvaev.
AForex expert Narek Avakyan emphasizes that the deal will open up new opportunities for Rosneft to develop international business, since TNK-BP already had experience in implementing international projects (in particular in the Middle East) and Rosneft's portfolio of international orders in connection with with this can be substantially replenished. "However, each medal has a flip side - further strengthening of the oil and gas industry in Russia will increase the federal budget's dependence on external market conditions for oil prices. Therefore, it would also not be entirely correct to judge this transaction from an exclusively optimistic point of view," the expert said. ...
Speaking about the prospects for possible further expansion of Rosneft, A. Razuvaev from Alpari points out that “its next target may become.“ The deal may take place in the fall and will definitely be in the interests of Rosneft and the state, ”the analyst predicts.
Return to the Arctic
In addition, V. Tanurkov from Veles-Capital and V. Metnev from BCS are unanimous in their expectations that after the TNK-BP deal, Rosneft and BP may return to plans for cooperation in the development of the Arctic shelf. Previously, the companies planned to create an alliance for this purpose, but the plans were thwarted by the opposition of the Russian shareholders of TNK-BP, who insisted that BP in Russia should with a Russian-British joint venture. They managed to defend their position in court, but now the obstacles to cooperation between Rosneft and BP in the Arctic have disappeared. True, over the past time, Rosneft has managed to conclude agreements on cooperation on the Arctic shelf with the American Exxon.
At last I will tell you
Experts were not mistaken in their forecasts: during a press conference on the evening of March 21, I. Sechin announced that Rosneft and its British partner British Petroleum (BP) intend to jointly develop fields on the Russian Arctic shelf.
I. Sechin noted that Rosneft has licenses to carry out operations at 41 offshore fields. In this regard, BP was asked to choose the most optimal project.
The president of the Russian company also noted that in the near future, Rosneft intends to focus on the exploration and production block and introduce the position of chief geologist in the company. I. Sechin added that Rosneft intends to form a new subdivision, which will develop the gas business of the company.
The head of the Russian company also shed light on operational management issues. According to I. Sechin, there is no question about the manager under the terms of the purchase. “As sad as it may sound to someone, the nature of the acquisition transaction differs from the merger-acquisition transaction, because when a merger-acquisition is in progress, the management is united, they agree on who is responsible for what, who gets what competence,” added I. Sechin ... He noted that Rosneft will take into account the need to develop a new asset, and everyone who wants to work "will continue to work." I. Sechin added that BP will be able to nominate a second candidate for a seat on the board of directors in the summer, after the annual meeting of shareholders.
"In accordance with corporate procedures, BP will have the opportunity to nominate its candidates. I think this will happen sometime in the summer after the meeting, in accordance with the law on joint-stock companies," Sechin said. The annual meeting of shareholders of the state corporation will be held on June 20 in St. Petersburg.
Rosneft has entered into agreements with TNK-BP shareholders - British BP and the Russian consortium Alfa-Aksses-Renova (AAR) - to buy out 100% of this company, the head of Rosneft said. Igor Sechin at a meeting with the president Vladimir Putin... “At the end of last week and the beginning of this week, we completed the main negotiations, and I can report that an agreement has been signed to buy out a stake in BP (in TNK-BP) from Rosneft,” he said. “We were actively working with a private shareholder - ААR, and a similar agreement was reached on the principles for acquiring their shares,” he said.
The head of Rosneft has estimated the cost of the deal to buy 100% of TNK-BP at $ 61 billion. "Taking into account the shares of Rosneftegaz, this deal will require $ 61 billion, and it will become the third largest deal in the world," Igor Sechin told the President of the country and added that the price of Rosneft shares for the purpose of the deal was named and approved in the agreement $ 8 per share. Vladimir Putin called the price of the deal good. “The price is good, even with a small premium,” he said.
As noted in a press release from the Russian oil company, in connection with the proposed transaction, BP made an offer to buy out an additional 600 million shares of Rosneft, which make up a 5.66% stake in Rosneft, from its parent company, OJSC Rosneftegaz, at a price $ 8.00 per share. Rosneftegaz may accept this offer until December 3, 2012. Rosneft and BP entered into a 90-day period of exclusive negotiations to sign the final purchase and sale agreement for TNK-BP. “The signing of the final documentation will become possible after the approval of the sale of 600 million common shares of Rosneft by Rosneftegaz from the Russian government, as well as the final approval of the transaction with TNK-BP by the boards of directors of Rosneft and BP. In addition, completion of both transactions will be subject to other conditions, including regulatory and other approvals, and are expected to occur simultaneously in the first half of 2013, the company said.
Upon completion of these transactions, BP will own 19.75% of Rosneft shares, including BP's 1.25% stake. According to Russian legislation, this share of ownership will give BP the right to appoint two of the nine members to the board of directors of Rosneft.
Rosneft also agreed on the main terms of a deal with the AAR consortium (Alfa-Access Industries-Renova) to acquire a 50% stake in AAR in TNK-BP for $ 28 billion, subject to reaching agreements on binding documents, obtaining corporate and regulatory approvals and certain other conditions. At the same time, the deal with ААR is completely independent of the deal with BP.
Rosneft intends to finance the cash component of the transaction by means of the available funds on the balance sheet of Rosneft and new credit funds.
The purchase of a 50% stake in TNK-BP from a British company would have a favorable effect on the activities of Rosneft, analysts at Investkafe say. Grigory Birg and Yulia Voitovich... “Due to the fact that TNK-BP has an extensive package of greenfield projects, Rosneft will be able to significantly increase production growth rates and revenue. In addition, the deal with BP will help strengthen cooperation between the companies, which will also have a beneficial effect on the activities of Rosneft in the future, they say. - Thanks to the purchase of 100% of TNK-BP, Rosneft will own about 40% of all production assets in the Russian Federation. However, there are certain drawbacks to Rosneft's buyout of the entire TNK-BP. Recall that to finance the purchase of a 50% stake in TNK-BP, Rosneft planned to raise about $ 15 billion from debt markets. The purchase of 100% of TNK-BP shares will require Rosneft to attract additional financing. This will significantly increase the debt burden and thus may lead to a revision of the debt rating of Rosneft. "
According to analysts, such a large-scale consolidation in the oil and gas industry could lead to an aggravation of confrontation in the government, as the increase in the state's share in the sector runs counter to plans to implement an extensive privatization program. However, the Russian authorities have recently announced that the privatization of Rosneft will take place on the previously announced date. “Thus, monopolization on the Russian oil market will not happen in the future,” analysts at Investkafe say.
For BP, this is definitely a good deal, says the head of the investment operations department of Lanta-Bank. Oleg Poddymnikov... “Firstly, the company managed to sell the asset with almost 40% premium to the market. Secondly, to withdraw from the rather problematic alliance with the AAR. In addition, BP receives a significant share in the state-owned company, which in the future may gain control over the entire TNK-BP, he lists. - For Rosneft, there are also pluses in this deal. The company will increase oil reserves by 27.66% to 18.238 billion barrels. Thus, the reserves will exceed those of Gazprom by more than two times and surpass ExxonMobil by 49.15%. In case of further consolidation of 100% of TNK-BP shares, reserves will grow by 55% and reach the level of 22.191 billion barrels. "
Of course, from the point of view of management efficiency, state-owned companies do not show the best results, the analyst notes. “On the other hand, it cannot be argued that the government is trying to completely get rid of private shareholders in the oil industry. At least, the plans for further privatization of the state-owned stake in Rosneft in 2013-2014 have remained in force, he says. - Rather, we can talk about a change in the category of investors. Instead of several large FIGs, a larger number of foreign and Russian portfolio investors will become shareholders. At the same time, the state receives investments and retains strategic control over the industry. Investors, in turn, in the future can get "oil" Gazprom ".
The information about the deal was expected, now Rosneft will become the leader among public companies in terms of production, agrees the director of analytical department at Alpari Alexander Razuvaev... “There is an additional plus for minority shareholders, now Rosneft's dividends will always be high, and this is what the tankers' shares have always been loved for,” he says. - However, I think this is not the last deal, Surgutneftegaz is definitely the next stop, it is not only 60 million tons of oil a year, it is more than $ 30 billion in cash. It is likely that Rosneft will need it to reduce its debt burden. The deal is also likely to include the redemption of Surgut's treasury securities, which, according to the market, are up to 90% of common shares. The stake in Slavneft will probably also be sold at a high price to Gazprom to reduce Rosneft's debt burden. ”
According to the analyst, the deal fully fits into Igor Sechin's line on resource nationalism. “And the expensive valuation reflects the real value of Russian oil and gas assets, which is undervalued on the stock exchange due to the risks of the eurozone,” he says. “I think that after Surgut, Zarubezhneft will become a target for takeover, and Transneft is very unlikely, and the rest of the companies will remain independent.”
Head of the Department of Appraisal and Investment Design of CJSC "MEF-audit" Dmitry Trofimov notes that this deal is of interest to Rosneft exactly in the format as planned. “The withdrawal of only the British from TNK-BP could create certain problems for the further development of this company, since the shareholders had a conflicting side for the British, which could nullify the synergistic effect of the deal for both companies. By buying out both stakes, Rosneft minimizes its management risks as much as possible, ”he says. - Of course, the opportunity to become the world's largest company in terms of reserves and production is very attractive, which, of course, should have a positive effect on the company's capitalization. But it is also important that in addition to money, BP receives shares in Rosneft and seats on the board of directors. At the same time, it is very important that in addition to joint projects and technologies, BP will be able to bring elements of Western corporate culture to Rosneft. "
Settlement in Rosneft shares with BP, on the one hand, brings private capital to Rosneft itself, and on the other hand, TNK-BP becomes a state-owned company, the analyst notes. “The trend towards privatization at maximum prices continues without losing state control over strategic assets,” he says. - FAS stated that the decision of the department on the application will depend on the nature of the transaction, including the size of the package. Given the "strategic" decisions made, there is no doubt that the "correct" design will be found, especially since the head of Rosneft said that "the deal will not affect the reserves and the market enough to speak of monopoly." In general, the vector for enlargement remains, as "light" resources are being depleted, and hard-to-recover reserves require expensive technologies. "
Of course, the announced deal amount of $ 61 billion is impressive, says an analyst at IFC Solid. Dmitry Lukashov... “The market capitalization of TNK-BP is only $ 38 billion. However, I believe that Rosneft did the right thing by taking advantage of the opportunity to acquire such an attractive asset in its entirety, - he is sure. - In theory, Rosneft may subsequently make an offer to the remaining minority shareholders at the price of a deal with the main shareholders. In this case, TNK-BP shares may be interesting for the purpose of speculative buying for small investors. According to my calculations, after the purchase of TNK-BP, Rosneft's share will amount to 37% in all-Russian oil production and a third in its refining. I believe that the domestic market will not be monopolized. It should be noted that less than half of the oil products produced are sold in Russia, and the rest is exported. If necessary, oil companies can slightly reduce foreign supplies and easily saturate the domestic market. ”
The deal looks like a "assembled puzzle" for all its participants, the partner of Advance Capital believes. Karen Dashyan... “The decision on a strategic alliance between BP and Rosneft was made long ago, and the shareholder conflict in TNK-BP reached its climax. At the same time, it is obvious that for a private Russian oil company, growth opportunities in the Russian oil and gas sector are extremely limited. At the same time, it should be noted that the conditions of the upcoming transaction are fairly fair for all parties, and if in this configuration it is possible to establish effective corporate governance, then the merged company will clearly receive high-quality impulses for growth in the Russian Federation and internationally, - he reasons. - Today, the landscape in the oil industry is such that it is difficult to develop without state participation in new growth points, such as the Yamalo-Nenets Autonomous Okrug, Eastern Siberia, on the shelf. All projects in one way or another are associated with the need to apply preferential taxation regimes due to significant investments in geology and infrastructure, on the one hand, and with the use of complex international modern and expensive technologies for their development, on the other. Thus, it is obvious that the alliance of state-owned companies and international vertically integrated oil companies is the most optimal in the existing, partly "manual" mode of industry management ”.
Whether this deal is successful or not, we will only know when the complete merger of the two companies is completed, which can take at least a year, or even more, notes the leading expert of the Finam Management Management Company. Dmitry Baranov... “After that, the merged company will have to work for at least a year to prove its effectiveness, despite the fact that it has seriously increased in size. And only then it will be possible to assess the effectiveness of its activities in a new quality and the success of the transaction that took place in 2012, - he says. - In general, judging by the way events developed, it seems that each of the parties was rather tired of negotiating and tried to quickly come to some kind of decision. That is, most likely, each of the parties agreed to a certain compromise so that the deal would be completed in the near future. Perhaps, over time, the details of these negotiations will become known, and we will find out who agreed to what compromises. "
According to the analyst, a version has been realized that previously seemed the most fantastic, although it has a right to exist. “Namely, the version that the scheme of the deal is changing and that Rosneft will be BP’s new partner in TNK-BP, that is, BP will not leave the company. BP is not really leaving the company, but will become a partner of Rosneft, he notes. - In addition, the assumption that this deal is not the beginning of the process of nationalization of the entire industry turned out to be true. High-ranking officials have already confirmed that privatization of part of Rosneft is planned for next year, and besides, the state in one form or another does not acquire other vertically integrated oil companies and has not announced anything like that. "
Now it is much more important to see, Dmitry Baranov believes, how this transaction will go, how successfully the merger of the two companies will end, each of which has different development strategies, different business standards, and different mining and production assets. “After all, they all have to be combined into a single working mechanism, and this is a very, very difficult task,” he says. “It is possible that the merger procedure will drag on for several years and during its implementation part of the assets may be sold, and it is not necessary that these will be TNK-BP's assets, it is possible that these may also be Rosneft assets.”
