TNK-BP Billionaire Fridman Quits as CEO, Deepening Dispute
Fridman, 48, who will leave within 30 days, also resigned from the company’s management board, leaving Viktor Vekselberg and German Khan, fellow shareholders in AAR, which owns 50 percent of TNK-BP, will remain, the company said. BP owns the rest of the venture, which accounts for about 25 percent of its production and reserves.
Fridman was supposed to stay at helm of the company until the end of 2013. Relations between BP and its Russian partners have often been fractious. In 2008, current BP CEO Bob Dudley was forced to resign as head of the venture and leave Russia. More recently, the billionaires sued BP over a deal with Russia’s state oil company, and the board hasn’t met this year because the investors can’t agree on an independent director.
“BP has already found it difficult to find candidates to replace its nominees as non-executive directors and identifying a CEO is likely to be even harder,” said Peter Hutton, an analyst at Royal Bank of Canada in London. “We might expect Fridman to be reviewing his stake and that is likely to create significant turbulence.”
A TNK-BP spokesman declined to provide reasons for Fridman’s resignation.
Fridman wasn’t directly involved in day-to-day operations, which will continue to be run by the management committee, Vladimir Buyanov, a BP spokesman in Moscow, said by phone today.
“Fridman’s departure extends issues with corporate governance,” Mikhail Rotaev, an oil and gas analyst at Renaissance Capital in Moscow, said by phone today. “Operational activities will remain with Khan and Vekselberg, so we do not expect any significant near-term changes in company operations and other activity.”
TNK-BP shares gained 0.8 percent to close at 84.70 rubles in Moscow today. The Micex Index rose 0.7 percent to 1,290.72.
BP and AAR, the group that represents the Russian shareholders, are seeking to fill a vacant slot on its 11-member board of directors after two of three independent members -- former German Chancellor Gerhard Schroeder and James Leng, a former chairman of steelmaker Corus Group Plc -- quit last year. Those resignations followed legal claims AAR filed to halt BP’s planned $7.8 billion share swap and Arctic tie-up with Russian oil champion OAO Rosneft.
Fridman remains one of four AAR directors on TNK-BP’s board. AAR and BP last week agreed to appoint Evert Henkes, a former head of Royal Dutch Shell Plc (RDSA)’s chemicals unit, as an independent director, leaving one open slot. Both sides agreed to delay paying dividends for the first quarter until the third independent director is found, allowing for a quorum.
Maxim Barsky, who quit as deputy chief executive on Nov. 1, may return to TNK-BP as a management adviser, Russian newspaper Izvestiya reported today, citing a person familiar with the matter it didn’t name.
Still, one analyst said Fridman’s departure could allow some progress in resolving the impasse over non-executive directors.
“I suspect this will make it easier to appoint the board,” Alexander Burgansky, an oil and gas analyst at Oktritie Financial Corp., said by e-mail from Moscow today. Fridman’s involvement clearly favored the interests of one shareholder group, he said.
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