Rival bidders pursue Lukoil assets despite Carlyle deal, sources say

By Anna Hirtenstein

Feb 6 (Reuters) – Chevron is one of at least two companies vying for Lukoil’s global assets, despite the Russian energy company’s initial agreement last week to sell them to U.S. private equity firm Carlyle, four sources familiar with the conversations said. 

Lukoil has until February 28 to sell the assets, the latest deadline set by the U.S. Treasury, which imposed sanctions on Lukoil and Rosneft last year to push Moscow to agree a peace deal with Ukraine.

A partnership between Chevron and Texas-based Quantum Energy Partners, as well as a group led by investment bank Xtellus Partners, is still in talks with Lukoil and the U.S. government on the assets, said two sources familiar with the discussions. The sources declined to be identified because the information is sensitive.

“It’s definitely not a done deal yet, Carlyle is just now starting to take a closer look at Lukoil’s assets,” said a source close to Lukoil. “The winds could still change on this sale.”

Lukoil has said it is continuing negotiations with other potential buyers.

Quantum and Chevron declined to comment.

CARLYLE IN PARTNERSHIP TALKS

The Lukoil portfolio, initially valued around $22 billion, has attracted interest from at least a dozen companies from Exxon Mobil to the former owner of Pornhub, Bernd Bergmair.

The U.S. Treasury’s Office for Foreign Assets Control rejected bids by Geneva-based commodity trading house Gunvor and Xtellus. 

Carlyle agreed on January 29 to buy Lukoil’s assets, excluding those in Kazakhstan. The fund is in talks to partner with Abu Dhabi-based funds Mubadala, XRG and IHC, as well as the U.S. Development Finance Corporation for the deal, according to sources.  

The agreement still requires approval from OFAC. Lukoil would also need a green light from the Kremlin and the Russian central bank, according to sources close to the process.

Xtellus, the former U.S. branch of Russian bank VTB, is working in a consortium with American billionaire Todd Boehly and UAE’s Allied Investment Partners, sources with knowledge of the matter have said.

They put forward an idea to pay for the deal in frozen Lukoil shares owned by U.S. investors, rather than a cash payment.

The consortium is still seeking to advance this plan and has had conversations with U.S. officials, according to a sixth source.

(Reporting by Anna Hirtenstein;Editing by Dmitry Zhdannikov, Emelia Sithole-Matarise and Susan Fenton)