State seizes 61% Yukos stake

13 April 2012

RUSSIAN authorities today seized a controlling stake in oil giant Yukos, spreading alarm on financial markets and sparking concerns over the West's future appetite to do business with Moscow.

With Yukos boss Mikhail Khodorkovsky languishing in a prison cell in the capital, facing charges of defrauding the State out of about $1bn (£589m), it was announced the State prosecutor's office had seized a 61% controlling stake.

The move immediately froze a record-breaking $730m Yukos dividend payment due to Khodorkovsky, the wealthiest of Russia's so-called oligarchs.

It also cast doubts over the signed merger with Sibneft, the oil giant linked to Chelsea FC owner Roman Abramovich, and is likely to hit ChevronTexaco and ExxonMobil's move to buy into the new YukosSibneft.

Shares in Yukos itself plunged 12%, dragging down Moscow's RTS market 8% to 496.66, while the rouble weakened against the dollar.

The move came as President Vladimir Putin met Western investors to reassure them he was committed to market reforms.

‘This is a major shock, and we're waiting to discover the full implications,‘ said a Moscow banking source. ?The crisis is clearly deepening and it's bound to hit confidence.‘ The shares seized belong to Khodorkovsky and his allies.

‘I can confirm a controlling stake of 61% has been seized, although these shares retain voting and dividend rights,‘ said Yukos spokesman Alexander Shadrin.

There was also concern at the reported resignation of Putin's chief of staff Alexander Voloshin, apparently in protest at the legal moves against Khodorkovsky, held for five days after a secret services raid.

Yukos insiders blame his arrest on hardliners around Putin, many of them former KGB spies, as Khodorkovsky had financially backed two pro-West parties which oppose the President.

Create a FREE account to continue reading

eros

Registration is a free and easy way to support our journalism.

Join our community where you can: comment on stories; sign up to newsletters; enter competitions and access content on our app.

Your email address

Must be at least 6 characters, include an upper and lower case character and a number

You must be at least 18 years old to create an account

* Required fields

Already have an account? SIGN IN

By clicking Create Account you confirm that your data has been entered correctly and you have read and agree to our Terms of use , Cookie policy and Privacy policy .

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged in