Lukoil's Alekperov Borrows, May Buy Conoco Shares

MOSCOW (Dow Jones Newswires), Sep. 29, 2010

Lukoil Holdings' major shareholder Vagit Alekperov borrowed from banks in a loan backed by $4.3 billion worth of Lukoil shares, an amount that's more than enough to buy up the remaining stake in Lukoil held by ConocoPhillips.

Redruth Investments Ltd., connected with Alekperov, earlier this month pledged 77 million American depositary receipts, equal to the same number of Lukoil shares, as security for a bank loan organized by UBS AG, Lukoil said Wednesday.

Meanwhile, Lukoil said Sunday the company had bought up more shares belonging to ConocoPhillips, bringing the total it has purchased to 12.6% out of the approximately 20% stake that the U.S. oil major held originally.

Lukoil Chairman Valery Grayfer Tuesday told the Interfax news service that the remaining stake 7.4% in ConocoPhillips would also be bought up, without elaborating.

Then Wednesday Lukoil said Alekperov had borrowed against his stake in the company, without giving further details, leading to speculation that he will use the loan to buy more shares, a common practice among Russian tycoons.

"We do not exclude the possibility that Alekperov's loan could help him buy the ConocoPhillips stake," VTB analyst Lev Snykov said.

Lukoil didn't immediately respond to requests for comment on the fate of the remaining stake held by the U.S. oil company. A ConocoPhillips spokesman said he couldn't comment on who is buying the shares.

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