“Rosneft” did not have time to buy Indian refinery within the prescribed period

The transaction on purchase “Rosneft” the Indian oil refining company Essar Oil Limited deferred for a few weeks, Reuters reported in a press-service VTB, which is involved in the financing of the transaction, and Essar.

“The closing of the transaction is delayed for several weeks due to the approval of Indian banks [which has not been obtained]. Both sides remained committed to close the deal as only a few have received permission from the banks,” — said in comments to VTB.

Russian oil company planned to buy 49% in Essar Oli. The remaining 49% stake will be shared by Dutch oil trader Trafigura and the Fund UCP Ilya Sherbovich, which in 2012-2013 was in the Board of Directors of “Rosneft”. About 1% will have the structure of Essar. The amount of the transaction is estimated at approximately $13 billion.

A source close to one of the parties to the transaction, said that the parties plan to complete the transaction to around 20.00 GMT on 31 March. The head of VTB Andrey Kostin in mid-March, also said that the deal will be finalized “in the near future, this month”. However, according to the interlocutor , to close the deal in an earlier time is not possible due to the sellers. He said that Indian businessmen, the brothers Shashi and Ravi Ruia, who control Essar and put the company up for sale, “twisting [the buyers]”.

Another source close to one of the parties to the transaction, explained that the postponement of the completion of the transaction is a “technical point”, as Essar “too many banks lenders, not all managed to negotiate”.

“Within a few weeks we’re going to get approval from the remaining banks, and then you can close the deal,” he added .

The representative of “Rosneft”, answering the question , promised to give comment later. The press service of the UCP has not yet responded to the request , sent Sunday morning, April 2. The press service of the Trafigura has also not yet responded to the request . The website Essar at the time of publication notes was not opened.

Rosneft and Trafigura UCP announced plans to buy stake in Essar Oil 16 Oct 2016. This was announced in the presence of the President of Russia Vladimir Putin and Indian Prime Minister Narendra modi at the BRICS summit in Goa.

Since the completion of the transaction was postponed. In mid-October, UCP and Trafigura said they plan to close the agreement for the purchase of its stake in Essar Oil by the end of 2016. However, this has not happened, and in mid-February, Reuters, citing sources said that the deal could be completed by March 15.

Then one of the sources Reuters explained that the completion of the agreement was delayed due to disputes, who will be part of the leadership of Essar Oil. Another interviewee reported that the transaction is complicated the debt restructuring process Essar Oil. The company said that the deadline for the closing of the transaction depends on its coordination with the major lenders, including State Bank of India.

Essar Oil is included in Essar Energy Holdings. The company owns the second-largest in India’s private refinery, tank farm, and infrastructure for the import and export of oil and oil products and petrol stations, the report said Trafigura and UCP. Essar explained the sale of one of its key assets that will help this group by nearly 50% to reduce existing debt.