After it was leaked earlier this week that a mysterious second bidder had submitted paperwork to acquire parts of Mikhail Gutseriev’s beleaguered Russneft, speculation on the challenge to Oleg Deripaska’s earlier bid centered on Roman Abramovich and Lakshimi Mittal, or state firms like Rosneft and Gazprom. It turns out that the papers were instead filed by Glencore, the Swiss commodities trader that originally cooperated with Gutseriev in the founding of Russneft (and had since continued the relationship). From MSNBC (via FT):
Alexander Temerko, the former Yukos vice-president and a business associate of Mr Gutseriyev, said Glencore’s filing, first made in September, was an attempt by the trader to protect its interests in the company after the bid by Mr Deripaska failed…Glencore helped Mr Gutseriyev found the company in 2000, lending more than $3bn and taking shares and oil as collateral. Mr Temerko said Glencore already held a considerable stake in RussNeft itself, while a banker familiar with the situation said Glencore owns stakes in Russneft’s production units.
The bid Glencore submitted to Russia’s Federal Anti-Monopoly Service was for three of those production units, and appears to be an attempt to keep itself involved in the successful oil venture.
Glencore had previously cooperated with Deripaska in the creation of the world’s largest aluminum firm in 2006, made from a combination of the Deripaska’s Rusal, the Russian company Sual, and Glencore’s aluminum assets. This history together was seen as a potential plus in the efforts of Deripaska to take over the reigns from Gutseriev, after the former chief stepped down under pressure. However, with Deripaska’s bid sidelined by apparently competing factions within the Russian government, Glencore stepped in (supported by its weight in the mining and metals industries) to attempt to regain control of the production units.
However, Glencore is not trying to take over the entire company — these 3 production units only account for about 15% of Russneft’s entire output. Instead, the bid for the firms, which are valued at around $800 million, could be a deal for Glencore to ensure it will recoup some of its outstanding loans. Glencore already controls significant stakes in three other production units stemming from a 2003 deal with Russneft. The Swiss firm also has an exclusive 10 year exporting contract (beginning Jan 1, 2004) for those three subsidiaries.
Deripaska’s bid for the company had stalled, allegedly over incomplete paperwork. Apparently, the additional documents arrived “a few days ago” and are in the process of being investigated. The overall fate of Russneft — including the three units pursued by Glencore — may still be a ways in coming, however.