Sechin says minority investors shares prices fair

By IVCPOST Staff Reporter

Oct 05, 2013 11:54 AM EDT

The share price offered by Rosneft to buy out minority shareholders of TNK-BP Holding was reportedly at a premium and should had no cause for complaint. Rosneft CEO Igor Sechin was quoted by Russian media, saying the buyout offer was fair. On Friday, Rosneft Deputy Chairman Andrey Kostin added that the buyout was lawful and in line with good corporate governance practice.

In September, Rosneft announced an agreement to buy the remaining shares of TNK-BP Holding for USD 1.5 billion. This priced ordinary shares at USD 2.07 apiece and preferred shares at USD 1.71 each. However, some investors were disappointed as they were hoping for a price of USD 3.70 per share. According to a Reuters report, analysts had estimated that Rosneft paid USD 55 billion to takeover parent TNK-BP and create the largest publicly-traded oil firm in terms of output.

One of the minority investors, Franklin Templeton's emerging markets group, had said Sechin's firm should have offered the same terms as the original buyout. However, Sechin said, "The Templeton fund has earned quite a bit from owning TNK-BP shares, receiving dividends alone amounting to more than 2 billion roubles (38.8 million pounds). They should be grateful to Russian and (President Vladimir) ... Putin for our investment climate," Sechin said.

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