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Tuesday, April 07, 2009

Gazprom, Eni in 4-bln-dlr buy-out deal

AFP04-07-2009 - MOSCOW (AFP by Anna Smolchenko) — Russia's Gazprom Tuesday signed a deal worth over four billion dollars to buy out the 20 percent stake owned by Italy's Eni in its oil unit Gazprom Neft, in line with the Kremlin's aim to keep key assets in state hands. The stake was among a clutch of assets in stricken oil company Yukos bought in April 2007 by Enineftegaz, a company jointly owned by Eni and Italy's power company Enel for 5.81 billion dollars (4.35 billion euros). The deal was inked as Russian President Dmitry Medvedev and Prime Minister Vladimir Putin praised Russia's privileged ties with Italy. "We have special relations with the Italian business community and I want these relations to develop," Medvedev said as he welcomed Italian businesspeople in the Kremlin. Eni had granted Gazprom the right to buy back the Gazprom Neft stake and stakes in several other companies within the next two years. Some analysts said at that time that the Russian authorities hatched that scheme to be able to keep the assets of the dismantled oil major Yukos in state hands. "The fact that Eni did not exercise any influence in how Gazprom Neft has been run means it did not really need that 20 percent stake," Vyacheslav Bunkov, an energy analyst with Aton investment bank, said Tuesday. The buyback deal signed in Moscow between Eni chief executive Paolo Scaroni and his Gazprom counterpart Alexei Miller in the presence of Prime Minister Vladimir Putin is worth 4.2 billion dollars, a spokesman for Eni said in e-mailed comments. The price "corresponds to the one originally paid for the stake by Eni plus interest," Scaroni said in Moscow. Gazprom in a statement later in the day put the Tuesday deal's price tag at around 4.1 billion dollars, adding its stake in Gazprom Neft would now amount to almost 96 percent. Gazprom Neft was formed in 2005 when Gazprom took over Sibneft, previously controlled by Millhouse Capital, a holding led by Roman Abramovich, once Russia's richest businessman. The Russian gas giant said it borrowed from a number of Russian banks to finance the deal following concern that the crisis was putting pressure on the firm. Separately, Gazprom said it had agreed to extend an option to buy 51 percent of SeverEnergia, formerly Enineftegaz, a Russian gas venture owned by Eni and Enel until May 30. In 2007, Enineftegaz had bought a number of stakes in Yukos and later transferred the 20 percent stake in Gazprom Neft to Eni. The 2007 auction was seen as the final stage in the dismemberment of what was once Russia's number one oil producer, which began with a series of court cases after the October 2003 arrest of former company chief Mikhail Khodorkovsky. The signing was scheduled to coincide with a visit to Russia by Italian Prime Minister Silvio Berlusconi who had to cancel his trip this week because of Monday's earthquake in Italy. In an address to Italian businessmen in Moscow, Putin praised the continuity in economic ties between the two nations. "Italy, its political leadership, the 'captains' of business have frequently acted as trailblazers in developing ties with Russia," he said in comments released by the government. "Non-trivial approaches, original solutions are in demand today as never before. There is a need to open new opportunities for cooperation, expand investment flows, industrial and technological cooperation," Putin said. Eni, Gazprom's partner in the South Stream gas project, said the agreements represented "a further step in fostering strategic cooperation" between Russia and Italy in energy field. The two nations will "develop joint projects in and outside Russia under the principle of reciprocity," Eni said.

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