The Kremlin has introduced that commodities dealer Glencore and Qatar’s sovereign wealth fund are collectively shopping for a 19.5% stake in Rosneft, Russia’s largest oil firm.
“It’s the largest privatisation deal, the most important sale and acquisition within the international oil and fuel sector in 2016,” President Vladimir Putin stated.
The shock transfer sees Glencore and Qatar paying $11.3bn for the stake in Rosneft, the place BP already owns 19.75%.
Moscow will preserve the controlling stake.
The long-planned sale is a part of the Russian authorities’s efforts to promote some state belongings to assist stability the finances amid a two-year recession brought on by a drop in international oil costs and Western sanctions.
A deadline for the sale was missed, and hypothesis grew that Rosneft was struggling to discover a purchaser.
The deal additionally marks a turnaround for London-listed Glencore, which had seen a collapse in its share value amid a plan to promote belongings and lower its enormous money owed.
Glencore’s shares have rebounded this yr. The Qatar Funding Authority is without doubt one of the largest traders in Glencore.
Talking at a televised assembly with Rosneft chief govt Igor Sechin, Mr Putin famous that the deal follows a rally in international oil costs after Opec’s choice to chop manufacturing.
Russia, though not a member of Opec, has agreed to chop its output in step with the cartel, and can attend a gathering with its member international locations on Saturday to debate particular particulars.
Mr Sechin stated that Glencore and the Qatari fund will type a consortium and have equal stakes. He added that Rosneft had performed talks with greater than 30 potential bidders earlier than putting the deal.
It had been thought that US and EU sanctions imposed on Russia following the Ukraine battle would deter enormous funding in Russia, though firms weren’t explicitly prohibited from taking part within the Rosneft sale.
The election of Donald Trump as US president has, nevertheless, raised hypothesis of a thaw in relations with Moscow.
Neither Glencore nor Qatar have but confirmed the acquisition.
The commodities dealer stands to profit by having access to Rosneft’s crude output, whereas Qatar will additional set up itself as a serious investor in a number of the world’s largest companies.