And $ 2 billion is not a pity. Why Rosneft needs a generous buyback of shares from minority shareholders
The transaction itself is the sale of a large stake in Rosneft to a consortium consisting of the Glencore group of companies and the Qatari investment fund, took place almost in the spirit of a military special operation. I., in fact, the reputation of both the buyer and the seller was quite consistent with this.
Everything is very funny here.
Glencore International AG, it is an abbreviation for Gl obal En ergy Co mmodities and Re sources, (vtranslation into Russian "Global Energy Commodities and Resources") is primarily a trading structure with a very peculiar charisma. The fact is that it is a Swiss trading company, one of the world's largest suppliers of raw materials and rare earths. The company was initially built on the principles of secrecy, high-risk and aggressive policies. Traded in Iranian oil bypassing the embargo, cooperated with Cuba and Libya, worked with South Africa at a time when there was apartheid and this, to put it mildly, was not welcomed. It remained, by the way, the only company that supplied grain to the Soviet Union, despite the international ban due to the war in Afghanistan. In 1983, the founders of the company, US citizens Rich and Green, were formally charged (by the way, the notorious Rudolfo Giuliani), and they were forced to flee the country first (one took Spanish citizenship, the other became Bolivian), and then retire altogether. , so as not to harm your brainchild. An interesting detail, it was they who laid the tradition: only those who work in it can own shares in Glencore, have retired - sell. Igor Ivanovich Sechin should understand this, and even somewhere, probably close.
In a word, guys, to put it mildly, are not easy.
What is absolutely certain here - there will definitely not be any "politics" when working with Glencore, as well as no "political influence" - in completely old American traditions there is nothing personal and political here, only business.
Rosneft, while retaining a controlling stake in the Russian state, receives far from only money, although money too. She gets a virtually guaranteed sales market, and without a market margin (or with a minimum). The income of traders is already embedded within the ownership structure of Rosneft itself, which is becoming perhaps the most “golden” asset of a large trading company.
The Kremlin is confident that the target date for the receipt of funds from the privatization of 19.5% of Rosneft shares to the budget - until December 15 - will be met. All the nuances of this process have already been agreed with the government and the President of the Russian Federation Vladimir Putin.
The budget from the privatization of Rosneft will receive € 10.5 billion. The President of the Russian Federation instructed the government and the Central Bank of Russia to carry out a phased conversion of funds from the privatization of Rosneft into rubles in such a way as to avoid exchange rate fluctuations.
The sale of the Rosneft stake is taking place amid a slight increase in the company's value (at the beginning of the year it was all estimated at $ 36 billion) and is intended to replenish the state budget.
Note that the privatization of the "Putin type" - with the preservation of state control over companies and a number of strict requirements in relation to the acquirers (in particular, their provision of a coherent development plan for the companies they belong to) is traditionally criticized by supporters of market liberalism as "fake".
Real privatization, they note, "continues to be a utopia."
Several weeks of foreign business trips of the head of Rosneft Igor Sechin led to an unexpected result: 19.5% of the shares of the oil company Glencore and the Qatar Investment Fund. But there are too many unknowns in the deal announced last night, and the diverging "testimonies" of the parties are still more confusing. It is not clear who exactly bought it and in what proportion: Sechin told Vladimir Putin that the distribution of shares in the consortium between Glencore and the Qataris would be 50-50, while Glencore claims that only 0.54% of the shares will end up in his indirect ownership. Rosneft. It is unclear how much they paid: € 10.5 billion according to the Kremlin versus € 10.2 billion according to Glencore itself. It is not clear who the seller was: the state-owned Rosneftegaz or Rosneft itself through an interim buyout of a stake from a shareholder, Igor Sechin is the main character in both companies.
Nevertheless, something can already be asserted with certainty. First, Vladimir Putin decidedly disliked the idea of Rosneft owning his shares, as a result of which a decision was made to look for an outside investor. The image costs of “director’s privatization” (which gives rise to direct analogies with the early 1990s, when the directors of former Soviet enterprises did whatever tricks they could to get them into ownership following privatization) outweighed Igor Sechin's hardware capabilities. In a sense, it can be argued that ex-Minister of Economy Alexei Ulyukaev, who tried to burden Rosneft with obligations to further resell this stake to third-party investors and met resistance along the way, suffered in vain. Against this background, the previous information about Putin's attempts to personally find third-party buyers in the person of, say, the head of Lukoil, Vagit Alekperov, looks logical.
Secondly, as a result, an intermediate scheme was found: frankly speaking, Glencore is not such an outsider for Rosneft. Companies are closely linked by long-standing large-scale contracting and financial relations In 2013-2015, Rosneft collected prepayments from Glencore for future supplies in the amount of up to $ 5 billion. By the way, this factor was immediately associated with the sale of 19.5% of Rosneft shares, and with the mysterious and super-closed placement that took place the other day “Rosneft” bonds worth 600 billion rubles: one of the versions is that “Rosneft”, by transferring its shares, will offset the prepayment debts to Glencore, and the funds raised through the bonds will go to the budget.
That is, frankly speaking, one way or another, the same Russian money worked to buy the stake, and “finding a large foreign investor"- an exaggeration.
In exchange for new deal Glencore received from Rosneft a 5-year offtake contract for the supply of oil - according to the company, the volume of 220,000 barrels per day, which would improve its portfolio quite well. Well, the Qatar Investment Fund, in turn, is the largest shareholder of Glencore (owns a share of about 9%) and suffered greatly in last years from unsuccessful investments and high debts of an international trader. Qatari investors will clearly benefit from the rise in quotes Glencore shares that can be expected from this transaction.
That is, in fact, we can say that instead of real strategic investors, Rosneft has found a comfortable portfolio investor for its shares, who has no goals related to gaining access to Russian reserves, developing fields, etc., and went to the deal because of a number of favorable tactical conditions (including bonuses offered by Rosneft itself, such as the aforementioned offtake contract).
Third, as mentioned earlier, no real strategic investor for the state-owned stake in Rosneft was found. Neither Chinese nor other Asian oil and gas companies, as predicted, fell for this offer - the link above explains the reasons for this in detail, but the main thing is that in Russian conditions minority stakes do not give real rights to management, especially in strategic state-owned enterprises.
As a result, the authorities were forced to sell the stake to a related trader, promising him some bonuses for this and attracting its main shareholder, the Qatar Investment Fund, which was clearly weighed down by the fall in share prices and Glencore's debt problems and, of course, is now happy to take part in saving this investment. ... There are pluses in buying these shares: Rosneft is recent times increased dividend payments, but there is still room to strive for - dividends are far behind the level of private companies per barrel of production. So Glencore and Qataris expect a good dividend flow from this stake (probably in the region of $ 400 million a year or even higher). BP, which owns 19.75% of Rosneft shares, has been very pleased with dividends lately, they have helped it to improve its financial performance quite well.
But there is also a big drawback: as shown by the lack of interest of strategic investors in Rosneft, the package being sold is illiquid. It will be almost impossible to sell it - and, by the way, from the point of view of strategic investors, the story that Rosneft shares were eventually sold to a related trader for Russian money is not very attractive in the image and once again emphasizes that in Russia, instead of full-fledged property rights we often deal with the facade of various schemes designed to cover up real control by state actors. By the way, pay attention to how Glencore hastened to assure investors that it will own only a small 0.54% stake in Rosneft: in fact, the policy of a trader burdened with debts has recently been aimed precisely at selling off assets. and not for the purchase of new expensive illiquid assets.
Many commentators explain the entry of the Qatar Investment Fund into the deal by some strategic interest of Qatar in Russian oil and gas projects, but this explanation seems to be an exaggeration. Qatar has so far refused to enter Russian projects and did not show any practical interest in them, despite the fact that many Russian officials and businessmen tried to persuade the Qataris for years.
The attempts to link Qatar's participation in Rosneft with the implementation of the agreement with OPEC on the reduction of oil production also look strange - there is no direct connection at all, the agreement with OPEC will either be fulfilled or not, the presence of a minority stake in one of the Russian oil companies does not at all it has no effect. And the Qatar Investment Fund, in principle, has other tasks, in its portfolio the main investments have nothing to do with oil and gas - on the contrary, oil and gas revenues are invested in other, often more high-tech, areas. So, most likely, everything is rather trite: Qatar, through the current deal, is simply profitable to improve the quality of its problem investments in Glencore.
The head of Rosneft, Igor Sechin, reported to Russian President Vladimir Putin on the completion of the deal to privatize 19.5 percent of the oil company's shares. This was announced on Wednesday, December 7, by the press secretary of the head of state Dmitry Peskov, the correspondent of "Lenta.ru" reports. “The buyers and strategic investors were a consortium of Glencore and the Qatari sovereign wealth fund,” said Peskov. The Kremlin spokesman also said that from the deal to the budget Russian Federation will receive 10.5 billion euros. According to him, Putin called it the largest agreement on the global energy market in 2016.
Now I'll just go through the comments and notes for this news.
Also to understand what was sold:
2013: Rosneft remains the main donor for the second year in a row Russian budget... At the annual meeting of shareholders held on June 20 in St. Petersburg, the president of the company, Igor Sechin, said that the company “is taxpayer number 1”: in 2012, 1.7 trillion rubles were transferred to the budget. rubles, which is 16% more than a year earlier.
2015: Rosneft in 2015 will remain largest taxpayer in Russia, the company said. In 2014, Rosneft transferred 3.096 trillion rubles to the budget, including revenues from the mineral extraction tax amounted to 982 billion rubles, from export customs duties - 1.683 trillion rubles.
UPD. More opinions on this issue: We broke the blockade of Western financiers
Photo: kremlin.ru
Rosneft CEO Igor Sechin reported to Russian President Vladimir Putin on the completion of the Rosneft privatization deal. 19.5% of its shares were bought by a consortium of Glencore and Qatar's sovereign wealth fund. The deal amounted to 10.5 billion euros, the money will go to the budget of the Russian Federation. According to Sechin, the consortium members received equal shares as part of the privatization. Putin called the deal "the largest in the global energy market in 2016." The President also stressed that the controlling stake in Rosneft will remain in the hands of the state.
The financing scheme from the trader's side will be as follows. He will invest € 300 million own funds and will also provide guarantees to a structure completely "fenced off" from Glencore's business, which will have to attract the bulk of the necessary funding from banks. If Glencore receives half of Rosneft's stake, it will need € 4.8 billion in debt financing to complete the deal. As the trader emphasizes, his participation in the transaction depends on the attraction of this financing, which, if successful, may take place in mid-December.For its part, Glencore will receive an offtake contract for the purchase of oil from Rosneft for five years with an annual volume of 220 thousand barrels per day (11 million tons). In addition, the trader and Rosneft are going to develop a strategic partnership in infrastructure projects, logistics and global trading.
Thus, as Kommersant suggested, Glencore did not take too much high risks on this deal and, apparently, was attracted to it at the last moment. At the same time, the trader's assessment of the transaction at € 10.2 billion raises the question of how much such a sale meets the criteria of the directive previously issued by the government, in which the minimum price for the Rosneft stake was set at 710.8 billion rubles. At the exchange rate of the Central Bank on December 8, the volume of the transaction corresponds to 698.7 billion rubles. The head of Rosneft, Igor Sechin, noted that the transaction was carried out at stock exchange quotations on December 6 - at that time, the transaction amount, at the Central Bank's exchange rate as of December 7, amounted to 700.6 billion rubles.
Finance Minister Anton Siluanov, commenting on the deal, said that the 2016 budget, as expected, will receive about 700 billion rubles. "This money will allow us not to raise funds Reserve fund, - said the head of the Ministry of Finance. - The money will obviously come, we will use this money. Therefore, everything that we planned in the budget in terms of receiving privatization money, we will do everything, we will get everything. "
Head of the Federal antimonopoly service Igor Artemyev said that the deal to buy a 19.5% stake in Rosneft was perfectly legal. According to Peskov, "the Kremlin had nothing to do with the preparatory work," and "President Putin did not have any contacts on the deal either." "Sechin and his team were personally involved in the preparation, which he actually reported to the president yesterday," Peskov said.
After the announcement of the results of the privatization deal, Rosneft shares renewed their all-time high and went up by 6% at once.
The true source of financing for the privatization of Rosneft, and with it - and federal budget The Italian bank Intesa will become the Russian Federation - it will provide the bulk of the funds, reports with reference to the sources of Reuters.The bank has a long history of cooperation with Rosneft and has been looking for applicants for its shares since the beginning of the year.
Glencore's involvement with the Qatari fund looks like a "cover-up," a market source told finanz. The scheme may look like this, he suggests: a company (Rosneft) places bonds and invests money in a fund, which then buys its own shares, receiving a commission for this - similar mechanisms were used during the privatization of the 1990s, when the purchase of companies was paid in cash from the accounts of the same companies.
Rosneft was able to get currency in the West, and the federal budget deficit with the help of an Italian bank was essentially financed by the ECB, "another source in the market told finanz.
finanz.ru
We have created a chat in Telegram for a quick exchange of news. If you became an eyewitness of an event or just found important news, send it rather here:
The head of Rosneft Igor Sechin reported to President Vladimir Putin on the sale of 19.5% of the company's shares for € 10.5 billion.
The buyers were Glencore and the sovereign fund Qatar Investment Authority, which will receive 9.75% each of Rosneft
$ 17.5 billion in two months
Rosneft Chief Executive Officer Igor Sechin reported to President Vladimir Putin in the Kremlin on the completion of the privatization deal, the Kremlin website says.
The budget will receive € 10.5 billion from privatization (721.25 billion rubles at the exchange rate of the Central Bank on December 7), Putin said. And together with the controlling stake in Bashneft, which Rosneft bought on October 12 for $ 5.3 billion, - $ 17.5 billion, he added.
"Even in the first part, this is the largest privatization deal, the largest sale and acquisition in the oil and gas sector in the world in the outgoing 2016," Putin stressed.
The buyers of 19.5% of Rosneft were a consortium of the world's largest trading company Glencore and the sovereign Qatar Investment Authority (as of June, it had $ 335 billion under management).
“I hope that their arrival in the governing bodies will improve corporate procedures, the transparency of the company and, accordingly, will ultimately lead to an increase in capitalization ", - said the president.
Glencore and Qatar Investment Authority will receive 50% each in this consortium, Sechin specified (quoted by RIA Novosti). That is, the effective share of each customer is 9.75%. This is the third largest package after the state-owned Rosneftegaz (its share will decrease from 69.5 to 50% plus three shares) and BP (19.75%).
What do you need to know in light of this news?
I’ll show you some charts and graphs about privatization, foreign ownership, and profit sharing, and you’ll decide what to do with this set of facts.
Fixed assets of Russia by type of ownership:
Source Rosstat, if anything: yearbooks of different years - section "National Wealth".
Almost nothing remained in the hands of the state. There is something else in the fuel and energy industry and that's it. And they are now actively selling this something, like Bashneft and Rosneft.
It is also important to understand that private property immediately goes under foreign jurisdiction:
This is to the myth that Putin allegedly stopped selling our Motherland. He did not stop it - he only strengthened it under the propaganda about getting up from his knees and so on.
Now how is the profit from the sale of our national wealth and the future of our children divided:
So think for yourself: should we be happy about the sale of almost 20% of shares of Rosneft, which has fallen in price, to Qatar - the sponsor of terrorists in the Middle East, as they say.