The majority shareholders in Yukos, Russia’s largest oil company, which is on the brink of collapse, are threatening to sue some of the world’s biggest investment banks for damages that could run into billions of dollars.
The shareholders have accused the banks, led by Deutsche Bank, of being “accomplices to theft”. The banks, which also include JP Morgan, ABN Amro and BNP Paribas, have offered to provide financing for the Russian state-owned gas giant Gazprom to buy Yukos’s main asset, its operating subsidiary Yuganskneftegas, next Sunday.
The asset is being sold off at a state-organised auction, with a starting price of $8.6bn (£4.5bn). A sale price of around $10bn is expected. Yukos claims the subsidiary, which represents about two-thirds of its oil reserves and production, is worth around $20bn.
It is the first time the shareholders have threatened to sue Western institutions.
Tim Osborne, a director of Menatep, which controls 60 per cent of Yukos, said that Yukos is likely to declare itself bankrupt at its annual shareholder meeting on Monday week, the day after the auction.
“It is a foregone conclusion that we will declare ourselves bankrupt if $10bn [for Yuganskneftegas] is reached,” Mr Osborne told The Independent on Sunday.
The company, which pumps about 2 per cent of the world’s oil production, is being pursued by the Russian government for $26bn in back taxes, which it cannot pay. Yukos says that the tax claims are politically motivated because its former chief executive, Mikhail Khodorkovsky, broke a promise not to get involved in politics. He was taken into custody last year, accused of tax evasion, and the court case is expected to conclude soon.
Mr Osborne said Menatep would sue any banks participating in the auction in Western jurisdictions, including the UK, the US and Germany, to recover what it believes is the true value of Yuganskneftegas. It has also threatened to sue the buyer of the subsidiary.
He said it was “highly unlikely” that Menatep would not take action. Menatep has already filed a legal complaint against the Russian government under the terms of the Energy Charter, which Russia has signed. But the move was seen as symbolic, as it is unlikely to result in a payout of damages to shareholders. Menatep hopes that it would get a fairer hearing in any legal action against the banks in non-Russian jurisdictions.
“The auction is an illegal process,” Mr Osborne said. “It’s nothing short of theft, or the expropriation of Yukos assets. Anyone who purchases the asset or who finances the acquisition participates in the theft and will be liable. We have a fiduciary duty to protect interests of shareholders. We are ready to go [to] Western jurisdictions.”