Saturday 24 February 2018

Peace threatening to break out in the long-running scrap for oil firm Petroneft

An engineer works on a Petroneft pipeline in Siberia
An engineer works on a Petroneft pipeline in Siberia
Petroneft shareholder Max Korobov at the Herbert Park Hotel in Dublin for yesterday’s meeting.
Michael Cogley

Michael Cogley

A shareholder meeting billed as a showdown between Petroneft and its biggest investor was called off at the last minute yesterday in a sign a deal between the two sides could be on the cards.

The board of Dublin headquartered oil and gas explorer Petroneft bought itself another week after the extraordinary general meeting (EGM), called for by its largest shareholder Natlata Partners, was adjourned.

Natlata had called the meeting to push for the removal of four Petroneft directors including chief executive Dennis Francis and directors David Sanders, Paul Dowling, and David Golder.

However, just before the EGM started Natlata owner Maxim Korobov agreed to postpone the vote until Monday, April 25.

Mr Korobov did not give detail on the type of negotiations between both parties but is confident that a deal can be reached before next Monday's meeting.

"I think the present board members will participate in some sort of compromise otherwise they wouldn't communicate to us," Mr Korobov said.

Natlata sought to add three new directors to the board in the form of Anthony Sacca, David Strut and Mr Korobov himself. After the adjournment Mr Korobov spoke about "increasing transparency" between the shareholders and the board.

"We are ready to send some of our experienced managers that are full of energy to assist the company in their performance.

"We see some obstacles in that because the board is in the habit of running the company independently, not listening to the shareholders, and I think this practice should be changed," Mr Korobov said.

Natlata said that it supports both of Petroneft's non-executive directors, Thomas Hickey and Gerard Fagan. Petroneft has previously claimed Natlata is trying to take control of the company without having to pay a fair price for the firm.

Yesterday Petroneft chairman David Golder took a concillatory line.

"PetroNeft and Natlata have made considerable progress in recent days towards achieving a compromise, which will be of benefit to all shareholders. The agreed adjournment of today's meeting gives both parties time to conclude a final agreement."

"Reaching agreement with our major shareholder will allow the company to focus on exploiting the potential of Licence 61 and other opportunities as they arise" he said.

Shares in the company fell by as much as 31pc to 2c yesterday. Mr Korobov said Petroneft can restore some value by acquiring Russian assets now that oil prices are low.

Before the EGM Petroneft cancelled a restriction notice placed on shareholder General Invest Overseas, which owns 10.7pc of the company. The restriction would have stopped General Invest voting on the Natlata motions.

General Invest has called for an additional EGM on Friday. It is seeking the removal of five Petroneft directors - the four sought by Natlata, as well as Gerard Fagan. In their place General Invest is seeking to add David Sturt and Antonio Pititto.

David Strut has previously been nominated as a director by Natlata Partners. Natlata said it will speak with General Invest in relation to its EGM.

Irish Independent

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