Russian aluminum tycoon seeks regulatory approval to buy embattled oil group

Russian aluminum tycoon Oleg Deripaska's company said Monday it is seeking regulatory approval to buy private oil group Russneft, whose owner says he has been forced out in a campaign by police and tax authorities.

Photo: Russian aluminum tycoon seeks regulatory approval to buy embattled oil group

Russian aluminum tycoon seeks regulatory approval to buy embattled oil group

A spokesman for Basic Element, Deripaska's holding company, said it had applied for anti-monopoly permission to acquire Russneft, which pumps 320,000 barrels of crude per day, and expected a decision within a month.

Whether Basic Element, or Basel, intended to hold on to Russneft, or sell it on to one of the state energy groups that have come to dominate the sector under President Vladimir Putin, was unclear.

Deripaska is viewed as loyal to the Kremlin and has said that he would sell his vast aluminum holdings to the state if asked.

"We will be glad if Basel purchases Russneft," said Mikhail Shishkhanov, the president of Russneft-affiliated bank BIN-Bank, in comments provided by Russneft press secretary Eduard Sarkizov.

Neither company would reveal details of how much was being offered, but a source close to the negotiations said that a price of between US$6.5 billion (EUR 4.8 billion) and US$7 billion (EUR 5 billion) was being discussed.

In a letter published in Russneft's corporate magazine and posted on the company's Web site, Russneft President Mikhail Gutseriyev said that he had been asked by unidentified people to quit the oil business, but he had refused, whereupon an "unprecedented hunt" had been opened against the company over two years by prosecutors, tax authorities and police.

The company faces tax claims of nearly US$1 billion (EUR 730 million); police charged Gutseriyev with illegal business activities in May.

While Gutseriyev said he didn't know why he was being targeted, he is reported to have angered authorities by bidding for overseas assets belonging to the Yukos oil company. Most of Yukos' assets have been taken over by state-controlled Rosneft, the last of which were acquired this spring.

Yukos was carved up after being hit with US$28 billion (EUR 21 billion) in back tax claims. The campaign against the company and its founder Mikhail Khodorkovsky was seen as aimed at punishing him for his perceived political ambitions and capturing a major chunk of the oil industry for the state.