Chelsea owner in $13bn sale of oil firm

RUSSIA: Russian tycoon Roman Abramovich pocketed $13 billion (€10

RUSSIA: Russian tycoon Roman Abramovich pocketed $13 billion (€10.8 billion) yesterday after selling his oil company to the state in the country's biggest-ever takeover.

The Chelsea FC owner made enough cash to buy new signing Michael Essien 290 times over in the sale of Sibneft to state-owned gas giant Gazprom.

This deal puts one third of Russia's oil output under state control, and leaves the Kremlin poised to become a global energy player in its own right.

The announcement of the deal came in a brief statement, in which Gazprom and Millhouse Capital, Mr Abramovich's London holding company, said simply that the deal had been made "in accordance with current legislation".


Questions remain about why Mr Abramovich sold Sibneft, Russia's fifth largest oil company, to the state with analysts reckoning he could have earned more in an auction. Critics claim he simply wanted to stay friendly with the Kremlin.

"It's a very simple thing," Sergei Ivanenko, vice-president of the opposition Yabloko Party told The Irish Times. "This is nationalisation. President Putin wants to take everything in Russia."

Certainly this deal leaves the Kremlin with all the levers of power. It already controls parliament and the government and all national TV stations. Regional governors are no longer elected but appointed by the president personally.

With this deal, Moscow is back in the position it was in as capital of the Soviet Union in 1991 - in charge of the country's energy supply. It puts Russia at odds with most other industrial nations which are busy privatising their firms.

Moscow seems intent on using energy as a strategic tool to secure influence in neighbouring states.

For Mr Abramovich, it marks the end of an extraordinary 10 years after he first bought Sibneft for just $100 million in a highly controversial auction in 1995.

Having already sold an airline and an aluminium company, he has "cashed out" of Russia, with the London football club now his only sizeable business interest.