Oil Trader Vitol Sues Latvian Regulator Over Ventspils Buyout

  • Market regulator has no official information about lawsuit
  • Case related to dispute over share price in mandatory buyout

A unit of Vitol SA, the world’s largest independent oil trader, is seeking as much as 10 million euros ($10.7 million) from the Latvian financial market regulator in a lawsuit related to a dispute over the cost of its buyout of Ventspils Nafta AS shares.

Vitol’s subsidiary Euromin Holdings filed the lawsuit in the Administrative Regional Court in Riga on Thursday, according to Ventspils Chairman Robert Kirkup. The Latvian Financial Capital Market Commission said it had no “official information” about the suit. Market participants have the right to seek “defense of their interests in court,” the regulator’s spokeswoman Elina Avotina added by e-mail.

Vitol boosted its stake in Ventspils Nafta, a Latvian port and pipeline operator, to 93 percent on Sept. 17, triggering a mandatory offer for rest of the shares. The country’s markets regulator set the price for the remaining stake at 4.56 euros per share, 46 percent more than Vitol’s offer, demanding that Ventspils Nafta’s stakes in subsidiaries be valued as if those units were fully owned by the Latvian company.

“We’ve had a difficult relationship with the FCMC on the issue of the mandatory purchase price, we feel that they incorrectly valued it,” Kirkup said in an interview on Thursday. The higher price “was certainly not voluntary, it was an instruction that that was the correct price and if Euromin did not change the bid price to 4.56 euros then, among other things, their voting rights could be suspended, and probably would be suspended.”

Ventspils Nafta owns 51 percent of Ventspils Nafta Terminal, with the remainder owned by another Vitol subsidiarity. It also holds 49.9 percent of Latvian Shipping Company, and 66 percent of LatrosTrans, a pipeline operator.

Kirkup said earlier that Vitol plans to buy the rest of Ventspils Nafta and delist the company from the Riga Stock Exchange.

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