February 19, 2010
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Home / News / Today's Headlines / Sistema Wants Approval From Watchdog for Russneft Purchase


Sistema Wants Approval From Watchdog for Russneft Purchase

Sistema, billionaire Vladimir Yevtushenkov’s holding company, may attempt to buy almost half of oil producer Russneft as it seeks to increase oil output to match its refining capacity, the conglomerate said Friday.

The company applied to the competition watchdog for approval to buy as much as 49 percent of Russneft, said a Sistema official, who declined to be identified citing company policy.

Sistema, which has interests in telecommunications, retail and real estate, entered the oil industry last year with an agreement to pay $2.5 billion for Bashneft, an oil producer in the Bashkortostan region, as well as three Bashkir oil refineries, a petrochemicals plant and an oil trader.

Sistema aims to more than double oil production to 25 million tons a year from Bashneft’s 12 million metric tons a year, to match its refining capacity, Sistema chief executive Leonid Melamed said in October.

Bashneft made an offer to buy out minorities in the oil refineries as it plans to consolidate the units.

Russneft founder Mikhail Gutseriyev fled the country in 2007, facing criminal charges, and agreed to sell a stake to billionaire Oleg Deripaska, pending antitrust approval. Deripaska’s En+ Group withdrew the application this year. Russneft’s oil output fell 11 percent to 12.7 million tons of oil last year, according to the Energy Ministry’s CDU-TEK statistics unit.

Copyright 2010.The Moscow Times. All rights reserved.


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