Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Viktor Vekselberg is one of four Russian oligarchs who are selling their stake in TNK-BP to state-controlled OAO Rosneft. (Pool/Reuters)
Viktor Vekselberg is one of four Russian oligarchs who are selling their stake in TNK-BP to state-controlled OAO Rosneft. (Pool/Reuters)

Tycoons to largely reinvest TNK-BP billions in Russia Add to ...

Soviet-born tycoons selling out of TNK-BP will largely reinvest the proceeds from Russia’s biggest takeover deal back into the country, the AAR consortium said on Tuesday, following President Vladimir Putin’s call on them to do so.

OAO Rosneft this month finalized a deal to buy half of the Anglo-Russian oil firm for $28-billion from AAR, a consortium of four billionaires – Mikhail Fridman, German Khan, Viktor Vekselberg and Len Blavatnik.

More Related to this Story

Mr. Putin said at a news conference last week he hoped the cash gained through the deal would be reinvested into Russia.

“For AAR, Russia was and will be the base platform for investment and it is Russia where they are planning to invest the biggest part of the proceeds, received through TNK-BP share sale,” it said in a statement.

The quartet will receive cash on completion of the deal which should win a green light from Russian and European regulators in the first half of 2013.

British oil firm BP PLC is also selling its half of TNK-BP to Rosneft, the state-controlled oil major, for $27-billion in cash and stock, valuing the entire takeover at $55-billion.

The transaction could add to chronic capital outflows from Russia, an issue that Mr. Putin highlighted in his annual state-of-the-nation address earlier this month.

AAR said it will also invest in international assets, in order to bring modern technologies into Russia.

Rosneft will buy out BP’s half stake in TNK-BP for $17.1-billion in cash and 12.8 per cent of its own shares, bringing down the curtain on a profitable but fractious alliance between BP and the oligarchs struck back in 2003.

Security Price Change
BP-N BP PLC 48.81 -0.23
-0.469 %
Add to watchlist
Live Discussion of BP on StockTwits
More Discussion on BP-N


Globe Investor - GIT Upsells
It's never been a better time to get Globe Unlimited
Try Globe Unlimited, featuring new Globe Investor Tools, for a special trial rate. Only 99¢ for your first month.

Are you a Globe Investor Gold subscriber?
You qualify for complimentary access to Globe Unlimited.
Visit: globeandmail.com/globeplusunlimited
Try it today

In the know

Most popular video »


More from The Globe and Mail

Most Popular Stories