Rosneft secures $16.8bn

Russian oil firm Rosneft said Monday it had signed two loan agreements worth $16.8 billion to finance the acquisition of British giant BP's 50-percent stake in the TNK-BP joint venture. Rosneft said it had obtained a five-year loan of $4.1 billion and a two-year loan of $12.7 billion from a group of large US and European banks that include Bank of America Merrill Lynch and Barclays. "We would like to thank our financial partners for prompt decision-making, ensuring the completion of a deal unprecedented for the Russian market," Rosneft chief executive Igor Sechin said in a statement. TNK-BP has been Russia's third-largest oil producer and a key holding of BP that was responsible for billions of dollars in annual profits. But the company was torn apart by board disputes between BP and the four Soviet-born tycoons who ran the other half of the company. BP put up its stake for sale in June and then agreed to a deal with Rosneft that offered it access to potential contracts in the Arctic and other lucrative Russian zones. The Russian firm then struck a separate $28-billion deal with the Russian tycoons that gave it full ownership of TNK-BP -- a move further consolidated the state's hold on the lucrative oil sector. The terms of the BP buyout will see Rosneft pay $17.1 billion in cash and shares that give the British group a 12.84-percent equity stake in Rosneft. BP also plans to buy a separate 5.66 percent share from the Russian state for $4.8 billion. Those purchases and its current 1.25 percent holding will give 19.75 percent of Rosneft's equity to the British firm.