Gazprom Neft Press Office:
Moscow, 18 October 2000; Sibneft and its Runicom affiliate will end an exchange of shares in Sibneft subsidiaries on 1 November, paving the way for a move to a single share. The company plans to consolidate the shares in its subsidiaries using a mechanism designed to protect the rights of minority shareholders during the consolidation process.
Sibneft plans in the near future to carry out a redenomination of shares in its main subsidiaries, exchanging all existing shares for new paper with a higher nominal value. Following the exchange, the existing shares would be annulled. Shareholders holding a quantity of shares insufficient to qualify for one new share will instead become creditors of the subsidiaries, and will receive the calculated market value of their stakes in cash.
The procedure is intended to allow Sibneft to raise its stakes in its key operating subsidiaries to 100%. This will be the first time that such a mechanism has been used by a major Russian oil company to consolidate stakes in its subsidiaries.
Sibneft affiliate Runicom in July renewed an offer to exchange shares in the parent company for equity in its Noyabrskneftegas production subsidiary, the Omsk refinery, its Omsknefteproduct retail subsidiary and oilfield service unit Noyabrskneftegasgeofizica.
The latest exchange offer which closes on 1 November has to date seen Sibneft’s stake in Noyabrskneftegas rise to 95.6%, in the Omsk refinery to 78.8%, in Omsknefteproduct to 82.6% and in Noyabrskneftegasgeofizica to 72.3%. Most of the remaining minority shareholders in the four subsidiaries hold negligible stakes. Once the switch to a single share is complete, the subsidiaries would continue to exist as separate legal entities in the near term, but their legal status may be changed.Tags: shareholders