TNK-BP Shareholders Estimated the Damage at $ 3 billion


Through the Russian court TNK-BP minority shareholders are going to recover damage cased by a cancelled transaction with Rosneft from the British BP. They estimated their damage at $ 3 billion, but this amount may still increase.  

TNK-BP minority shareholders estimated damages caused by a cancelled transaction between BP and Rosneft which cost 87,1 billion rubles (about $ 3 billion). This difference between the price of Rosneft shares (about 1 million shares) for the present date and the price of their purchase, which TNK-BP would get in case of change of BP in the transaction. The amount of the claim may still increase “after reclamaition and consideration of additional documents”, the press-office of Liniya Prava advocate bureau, which represents minorities’ interests, announced yesterday. Before this, minorities said that damages could be estimated at $ 10 billion. 

We could not get in touch with the minorities’ representative. In Liniya Prava they explained to RBK daily that at the request of the commercial court TNK-BP and BP submitted to minorities the documents related to the transaction between Rosneft and BP. Following the results of their consideration the decision was made to file two claims. One of them is against members of the board of directors of TNK-BP Holding – vice-president of BP in Russia and Kazakhstan Peter Antony Cherow and vice-president of BP Richard Scott Sloan. Minorities think that defendants could not but knew about negotiations between BP and Rosneft, so they should have informed the company about the possibility to take part in strategic partnership, but they didn’t do it. 

The ground for filing the second claim, against BP, is the fact that the British company managed to get the decline by the board of directors of TNK-BP Limited of the offer on participation of TNK-BP Holding in the alliance with Rosneft.

The amount of damage, estimated by minority shareholders, will be, most probably, decreased by the court, as it is impossible to foresee all factors, which could influence the price of shares which were not obtained, Andrew V. Pushkin, Managing Partner of Tenzor Consulting Group, points out. This is a plaintiff who will have to prove the fact of violation of his rights, presence of causation between this fact and damages, as well as the amount of damages. “Moreover, plaintiffs will have to prove the fact that the members of the board of directors violated their obligations. Russian judicial practice proceeds from the fact that these persons cannot be convicted if they acted within a reasonable business risk. However, this category is largely estimating”, - Mr. Pushkin says.

BP also has initiated judicial proceedings recently. It filed to Stockholm tribunal a note about the beginning of arbitration consideration of the case against one of large TNK-BP shareholders – Renova (it is included in the consortium Alfa-Access-Renova). The plaintiff accuses Victor Vekselberg’s company of violation of the shareholders agreement by the purchase of several Russian and Ukranian gas distribution assets directly, and not though TNK-BP, as it is required by the agreement. 

Galina Starinskaya

Source: RBK Daily

15 August 2011