OREANDA-NEWS. June 01, 2009.  This time it will cost 16 billion rubles less. TNK-BP returned to redemption of shares from the minority shareholders. They can sell their shares provided that at the annual meeting of shareholders they vote against accession of four TNK-BP subsidiaries owning 5% of TNK-BP to the company. Back in October 2008, TNK-BP already initiated such a transaction, which could cost her 40 billion rubles, but eventually abandoned it. Now redemption of shares will cost the company 16 billion rubles less, but the minorities may not choose to sell their shares as they will receive no bonus over the market price of the shares.

One of the issues to be discussed on June 30 at the annual meeting of shareholders of OJSC TNK-BP Holding (incorporating the main assets of TNK-BP) is reorganization of the company by merging its four subsidiaries JSC “Sborsare Management,” CJSC “SIDANCO-Investments,” CJSC “SIDANKO-Neftepererabotka,” and CJSC “SIDANCO-Securities.” These companies are 100% subsidiaries of TNK-BP Holding and altogether own 5.366% of its ordinary shares (5.217% of its charter capital). Reorganization is required for avoiding double taxation, which takes place when subsidiaries receive dividends from the holding and then return all these funds to it.

The company implied to carry out such reorganization in the fall of 2008, but its main owner Novy Investments Limited, owning 95% of TNK-BP Holding, voted against at the meeting of shareholders. In case of approval, TNK-BP would have to redeem shares from the minorities, which held 3.3% of ordinary shares (5.1% of the charter capital) and did not support the idea of reorganization. The company explained then that this transaction “would require considerable funds, payment of which would cause a number of difficulties for TNK-BP in the conditions of financial crisis.” Redemption of shares would have cost TNK-BP 40 billion rubles. The price of ordinary and preference shares was set by the company at 48.49 rubles each, which was 11% higher than the market value of the voting shares and 40% higher than the market value of the preference shares.

The current price of ordinary and preference shares was set on May 21 by the Board of Directors of TNK-BP at 28.79 rubles each. According to the estimates of Konstantin Cherepanov from KIT Finance, if all the monitories submit their shares for redemption, the company will have to pay nearly 24 billion rubles, which means that redemption of shares will cost her 16.5 billion rubles less than in the fall of 2008.

Experts say, however, that TNK-BP will not have to run into high expenses. The repurchasing price does not imply any significant bonus over the market price, said Vitaly Kryukov, analyst of IFD Kapital. On Friday, the price of ordinary shares of TNK-BP at the RTS Board was at the level of 32.74 rubles each (12% higher than the market value), and the price of preference shares of the company was 26.31 rubles each (8.6% lower than the market value).

According to the law, a company may hold its own shares no longer than a year and then has to either sell or cancel them. TNK-BP saidthat the company management has not arrived at a final decision yet. “The decision depends on the number of shares we can get,” say company representatives. Redemption of shares repurchased from the subsidiaries will increase the earnings per share and have a positive impact on the company ratings. In any case, consolidation will simplify the ownership structure of the company, the expert added.