Swiss trader Glencore leaves the capital of the oil company Russneft

Swiss trader Glencore will be able to close a deal to exit the capital of the oil company Russneft after more than 20 years of holding shares, the corresponding permission was signed by the President of the Russian Federation. According to market participants, since the deal was agreed upon at the end of 2021, the value of the 23.5% stake in RussNeft has decreased. Kommersant’s sources believe that the recipients of the shares, as originally planned, will be structures close to the founder of RussNeft, Mikhail Gutseriev.

President Vladimir Putin has authorized transactions with RussNeft shares, corresponding order February 2 published on the official Kremlin website. The document makes it possible to close a deal to exit the company from the Swiss trader Glencore, who has participated in the formation of Russneft since the early 2000s, lending to its founder Mikhail Gutseriev. Also, Glencore was actually a monopoly buyer of the raw materials produced by RussNeft. The trader’s share in the company’s capital at one time reached almost 50%. But in 2016, the Swiss company’s stake was diluted to 24% as a result of an additional issue in preparation for Russneft’s IPO.

Currently, Glencore, through its structure Rambero Holding, owns 23.46% of the authorized capital of Russneft (31.28% of ordinary shares). Glencore’s decision to withdraw from RussNeft accepted back in 2021.

The parties intended to close the deal in the first half of 2022, but the outbreak of hostilities in Ukraine and restrictions on the withdrawal of foreign capital from the Russian Federation required lengthy approvals.

“Permission to conduct transactions allows you to credit funds to the accounts of the new owner and thus finalize the transaction for the sale of the foreign shareholder’s share, as well as continue redomiciliation (transfer of assets from one jurisdiction to another.— “Kommersant”),” noted Kommersant’s interlocutor familiar with the situation. In his opinion, the buyer will not be Mikhail Gutseriev himself, who has long had no control in Russneft, but structures close to the businessman.

The sale amount was not disclosed. According to industry participants, in 2021 the foreign shareholder chose a good time to exit, given the rise in oil prices, and could receive a price close to the market price for the stake. At the end of 2021, the Glencore stake was worth at least 11 billion rubles on the market. However, two years later, the ruble exchange rate has weakened significantly, and even if the deal is now closed at the originally planned price, for Glencore it will be a completely different amount, Kommersant’s sources in the market note.

Glencore, immediately after the outbreak of hostilities in Ukraine, stated that the trader “does not have an operational presence in Russia” and its “trading presence is not significant.”

In September 2023, RussNeft President Evgeny Tolochek reported that de facto the Swiss trader does not participate in the management of the company. “This topic has been closed for a long time, the page has been turned. Glencore is not among the founders,” he explained.

As of mid-2023, a key stake of 33% of the authorized capital of Russneft belonged to structures close to Mikhail Gutseriev’s holding company Safmar. Thus, Bradinar Holdings owned 12.05%, Mlada CJSC – 7.7%, IC Nadezhnost OJSC – 4.95%, and SSFAI PJSC had another 8.38%. Bradinar Holdings and Mlada’s parent company Negard carried out redomiciliation from Cyprus to the Russian Federation in December 2023. Another 16.52% in Russneft belongs to Trust Bank, 26.94% belongs to other shareholders.

Pen & Paper partner Kira Vinokurova notes that the exit of foreign entities from Russian assets is generally encouraged by European and Swiss regulators. For example, Art. 5b of EU Regulation 269/2014 allows the issuance of licenses to release the assets of a sanctioned person if this is necessary for the sale of their shares or other assets, she explains. The lawyer reminds that RussNeft, unlike Mikhail Gutseriev, is not under Swiss sanctions. “Probably, the Swiss company demonstrated to the regulator that as a result of the sale of a stake in Russneft, no economic benefit would be provided to Mikhail Gutseriev,” Ms. Vinokurova believes. The permission of the President of the Russian Federation, in turn, opened up the possibility of a deal on the Russian side.

Olga Mordyushenko