Rothschild helps former BP boss get his life back

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The Independent Online

Tony Hayward went a step further towards putting BP's troubles behind him yesterday, announcing a £1bn venture with Nat Rothschild to invest in the booming emerging markets energy sector. The former BP chief executive and Mr Rothschild, scion of the legendary banking dynasty, are seeking to raise £1bn by listing Vallares, a shell company, on the London Stock Exchange's main market.

The company will then buy or set up a business with major operations in the oil and gas sector to tap into the increasing global demand for commodities.

The venture will be Mr Hayward's main job after he was forced to quit as BP's chief executive last year over the Gulf of Mexico oil spill. His fate was sealed when he said "I want my life back" while dealing with the disaster, which killed 11 rig workers.

The placing price for each ordinary Vallares share will be £10 and the order book will close on 20 June.

Vallares will target one or more companies with a total market capitalisation plus debt of between £3bn and £8bn. Russia, Africa and the Middle East are potential countries for investment.

Mr Hayward said he wanted to target businesses in the hands of private owners who do not have the cash needed to fulfil their potential. Listing on the Stock Exchange will allow Vallares to pay in its own shares, giving the target's owner the chance to keep a stake in the business. The owner will get the benefit of Vallares' expertise and the capital-raising capacity of a London listing without having to wait at least three years to go through the process of approvals.

Mr Hayward said: "Many high-quality international resource assets have been acquired by family-owned or private companies in the last few years. We will have the cash, access to funds and the capability to unlock value where the current owners have neither the capital nor the technical expertise to develop the assets."

Mr Hayward's public relations problems made it impossible for him to continue as BP's boss, but some investors believe his departure robbed the company of one of the most talented oil men of his generation.

Before becoming BP's chief executive, he led its exploration and production division and was in charge of all the company's oil and gas fields worldwide. He is now senior non-executive director at Glencore, the commodities trader that raised $11bn (£6.7m) last month in London's biggest initial public offering.

Mr Hayward and Mr Rothschild are joined as founders by Julian Metherell, the former head of UK investment banking at Goldman Sachs, and Tom Daniel, a fund manager and close associate of Mr Rothschild.

Mr Metherell said: "This is Tony's principal operational role going forward and that is one of the things that makes this vehicle very attractive to potential partners."

The Vallares plan is modelled on Mr Rothschild's Vallar project, which raised £707m in an initial public offering last July to buy mining and commodity assets. Vallar agreed in November to invest $3bn in two of Indonesia's biggest coal miners.

The four founders have come up with £100m of capital for the Vallares and will lose £20m if they do not do a deal in two years. Rodney Chase, the former deputy chief executive of BP, will be Vallares's chairman.

Mr Hayward and Mr Rothschild are betting energy prices will keep rising as industrialisation and urbanisation, particularly in Asia, increase demand for oil and gas.

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