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TNK-BP Advances Most in Two Years on Report of Gazprom Offer

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Bloomberg: TNK-BP Advances Most in Two Years on Report of Gazprom Offer

By Greg Walters

April 24 (Bloomberg) — TNK-BP, BP Plc’s Russian venture, climbed the most in almost two years in Moscow trading after Vedomosti newspaper reported that OAO Gazprom may pay $20 billion for control of the company.

TNK-BP’s ordinary shares advanced 10.3 percent to $1.93 on the RTS at 11:08 a.m., heading for the biggest gain since June 2006 and the second-biggest since trading started in 2005. The advance values the Moscow-based TNK-BP at $30.6 billion.

The price reported by Vedomosti, which cited unidentified people familiar with the matter, indicates Gazprom is offering to pay $2.04 per share, 17 percent more than yesterday’s close, Moscow-based investment bank Troika Dialog said.

“Gazprom could buy into TNK-BP at a hefty premium to the implied TNK-BP Holding share price,” Troika said in an e-mailed note to investors today. The acquisition would also be positive for TNK-BP’s minority shareholders because “the uncertainty surrounding the company and its political problems would disappear,” Troika said.

BP owns half of TNK-BP International Ltd. and the other half is split between billionaires Len Blavatnik, Mikhail Fridman and Viktor Vekselberg. The venture in turn owns about 95 percent of OAO TNK-BP Holding, whose shares trade in Moscow.

London-based BP, Europe’s second-biggest oil company, has agreed to sell 1 percent of TNK-BP International to Gazprom, enough to give the Russian company control if it gains 50 percent from Blavatnik, Fridman and Vekselberg, Vedomosti said.

“We don’t comment on rumors,” TNK-BP spokesman Vladimir Bobylev said by phone in Moscow. No one at Gazprom or BP was immediately available for comment. TNK-BP shareholder Viktor Vekselberg’s Renova Holding said no one would be available to comment until later in the day.

BP rose 0.7 percent to 587.5 pence at 8:27 a.m. in London, valuing the company at $219 billion. Gazprom’s shares were little changed at 315.69 rubles ($13.47), valuing the company at almost $320 billion.

To contact the reporter on this story: Greg Walters in Moscow [email protected]

Last Updated: April 24, 2008 03:39 EDT

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