TNK-BP mulls tie-up with Rosneft-BP alliance
19 Feb 2011
The management of Russian oil giant TNK-BP has told the board that the company should join BP's proposed alliance with Rosneft.
TNK-BP, owned jointly by BP and four Russian billionaire shareholders, held a board meeting in Paris yesterday. At the meeting, the management expressed "potential interest in participating in the alliance".
This month, TNK-BP's Russian shareholders, collectively known as the AAR group, succeeded in getting a suspension order from a London court to BP's deal with Roseneft that involves a $16-billion share swap and the joint development of a vast Arctic oilfield.
According to AAR, the alliance between BP and Rosneft violates a shareholder agreement that allows only TNK-BP to be the "primary vehicle" for any new opportunities in Russia for either party. On failure of the two sides to reach an agreement by 7 March, the matter would go to arbitration.
The discussion during yesterday's board meeting was said to be of "preliminary in nature". An extraordinary meeting has been scheduled for next Friday and the only item on the agenda would be whether to join the BP-Rosneft alliance, according to Stan Polovets, chief executive of AAR.
Mikhail Fridman is another AAR shareholder who serves as chief executive of TNK-BP.
According to Polovets, when the issue of joining the BP-Roseneft partnership came up for voting, the company's BP-nominated directors would have a duty to act in the interests of TNK-BP.
He added that directors from both shareholders group as also the independents understood that when they participated in a TNK-BP board meeting they had a fiduciary duty to TNK-BP and were obligated to act in the best interests of TNK-BP.
