Rosneft circled in on TNK-BP yesterday as the state-owned oil giant tabled a bid of about $28bn (£17.5bn) for BP's half of the Russian joint venture – just two days after offering the same amount for the other 50 per cent.
Rosneft has offered BP a mixture of cash and shares for its stake in TNK-BP, a joint venture between the FTSE 100 company and AAR, a quartet of Russian billionaires, that has been fraught with tension since it was created nine years ago. The deal would give BP between $15bn and $20bn in cash as well as a stake of between 10 and 20 per cent in the company, sources said.
The bid was lodged first thing yesterday after Igor Sechin, pictured, Rosneft's chief executive and a former Deputy Prime Minister of Russia, flew to London for talks with BP. The offer, which BP has yet to acknowledge publicly, is the second part of a co-ordinated attempt by Rosneft to gain full control of TNK-BP. In the first part, Rosneft has agreed to pay the AAR consortium about $28bn for its stake in TNK-BP, although details have yet to be finalised.
Rosneft is thought to be keen to pay cash for the whole stake, although some analysts have questioned whether it would be able to raise enough money to buy both halves of TNK-BP. As a result, Rosneft is understood to be discussing the possibility of funding part of that deal by giving the four billionaires small stakes in itself.
It is also thought to be discussing the possibility of deferring part of the cash payment to AAR. If the deal Rosneft has proposed with BP is finalised, the oil giant would receive much-needed cash to help finance the tens of billions of dollars of compensation it owes as a result of the Gulf of Mexico oil spill.
Meanwhile, the shares BP would receive in Rosneft would give it a stake in Russia's vast and growing hydrocarbon reserves. While BP is thought still to prefer a sale of its stake in TNK-BP, analysts said it was still possible the company may decide to hold on to it.
BP and AAR's nine-year relationship saw court cases and harassment claims by Bob Dudley, then head of TNK-BP, now BP's chief executive.