BP board considers Rosneft bid for TNK-BP

Fri Oct 19, 2012 10:22am EDT
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By Andrew Callus and Megan Davies

LONDON/MOSCOW (Reuters) - Rosneft (ROSN.MM: Quote) is poised to secure a tighter grip on Russia's oil industry by buying BP's (BP.L: Quote) 50 percent stake in TNK-BP TNBP.MM, the country's third largest producing company.

The British oil company's board was expected to consider a cash and stock offer worth over $25 billion on Friday that would allow it to exit a profitable but troublesome joint venture.

The offer is not tied to asset deals or exploration tie-ups with Rosneft, although sources said those may follow.

Rosneft has already made a tentative offer to BP's equal partners in TNK-BP, the AAR consortium owned by four Soviet-born tycoons, that could be worth up to $28 billion.

"If and when BP reaches any agreement it will make an announcement at the appropriate time," BP said in a statement.

Some British newspapers reported that BP's chief executive Bob Dudley would be recommending the offer to his board.

"The offer is in. It's a split of the two," (cash and shares). It's a clean offer and there's no other plan on the table," said one source.

"If he thinks it's the best offer Dudley will recommend it but the board may say we need to reconvene and consider this aspect or that. It's not an automatic tick in the box."   Continued...

BP logo is seen at a fuel station of British oil company BP in St. Petersburg, October 18, 2012. State oil firm Rosneft tightened its grip on the Russian oil industry on Thursday, lodging a cash and shares bid for British oil company BP's 50 percent stake in the country's third-largest oil producer, TNK-BP. REUTERS/Alexander Demianchuk