TNK-BP Holding Jumps on Sechin’s Minority Comments: Moscow Mover

OAO TNK-BP Holding rose to the highest in almost a month in Moscow after Igor Sechin, chief executive officer of new owner Rosneft, said he’s ready to work with minority shareholders in the venture.

The stock jumped as much as 8 percent and closed up 3.3 percent at 45.94 rubles in Moscow, the strongest since March 25. The amount of shares traded was 1.8 million, equivalent to about 2.5 times the three-month daily average.

“I understand there’s a certain desire among TNK shareholders to get clarity,” Sechin said in a meeting with investors in London. Rosneft is ready to discuss “constructive ideas” from minority owners, he said.

Rosneft became the world’s largest publicly traded oil producer by output last month when it closed its $55 billion acquisition of TNK-BP from BP Plc and a group of billionaires. The company’s decision not to buy out minority stakes in TNK-BP followed by a move to borrow money from the holding and end its dividend policy sent shares of TNK-BP’s traded unit tumbling the most on record on March 26.

Investors including Prosperity Capital Management Ltd., which manages about $4 billion of Russian assets, said at the time Rosneft was putting Russia’s reputation at risk.

Mark Mobius, executive chairman of Templeton Emerging Markets Group, said minority shareholders in Russia face a “very risky, unstable situation,” at a Moscow conference on April 18, citing Rosneft’s treatment of TNK-BP shareholders.

“They are talking to the minority shareholders, are discussing paying dividends,” Andrey Polischuk, an analyst at ZAO Raiffeisenbank in Moscow, said by phone today. “Their position isn’t as tough as before.”

TNK-BP, which paid out most of its profits to shareholders, would need to change its dividend policy in order to maintain its asset base, even if Rosneft didn’t purchase the company, Sechin said.

“There’s a time to gather stones and a time to throw them,” he said.

Prosperity Capital has started discussions with Rosneft along with other investors, Prosperity Capital Chief Investment Officer Alexander Branis said today on an investor call.

Before it's here, it's on the Bloomberg Terminal.