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Yukos receives default notice on US$1 billion credit
The Associated Press
The Russian government could theoretically restructure the Yukos oil giant’s 99.4-billion-ruble (US$3.4 billion) back taxes bill, a senior official said July 6, sending the company’s shares temporarily up 22 percent.
“I am speaking in a clear hypothetical sense, that theoretically such a possibly could be realized,” said Deputy Finance Minister Sergei Shatalov, who is responsible for tax issues, according to Russia’s Interfax news agency.
He added that this was his personal opinion, and that he wasn’t aware of any talks between Yukos and the Finance Ministry.
Shatalov said the Finance Ministry would have to make such a decision by August before a new law comes into force “under which the repayment in installments can be decided exclusively by the tax authorities,” the ITAR-Tass news agency reported.
Shatalov’s comments — although vague — sent Yukos’ shares soaring on the RTS index from 188 rubles (US$6.21) to 230 rubles (US$7.93). But Shatalov noted that such a decision to restructure would be “difficult” because it violates the principles and rules of the game, Interfax said.
“It is very important to draw the line somewhere,” Shatalov was quoted as saying. Making a special case for Yukos would require a special resolution and would be “to a large degree political,” he said. Bankruptcy feared A senior Yukos official had warned July 5 that the government was driving Russia’s largest oil producer to the brink of insolvency after a group of Western banks, led by Societe Generale, issued notification that they could call in a US$1 billion loan to Yukos.
In addition to the crippling tax bill for 2000, the Russian government has frozen Yukos’ assets, giving it no way to raise money to pay the bill. Additionally, the Tax Ministry issued another 98 billion-ruble (US$3.3 billion) back taxes bill to Yukos for 2001. Prosecutor General Vladimir Ustinov said on Russia’s Ekho Moskvy radio July 6 that more back taxes claims were likely to follow for the years 2002 and 2003, the Interfax news agency reported.
“It’s a snowball,” Ustinov was quoted as saying. “This case has a beginning, but it is very difficult to see the end.”
The Kremlin has claimed repeatedly that the actions against Yukos and its jailed former CEO Mikhail Khodorkovsky are part of a broader drive against economic crime and corruption.
But observers see the company’s woes as being the direct result of Khodorkovsky’s alleged political aspirations and his funding of opposition parties ahead of last December’s parliament elections.
Since the probe against Yukos began a year ago, the company has lost about half its market value.
President Vladimir Putin said last month that the government isn’t interested in seeing Yukos driven into bankruptcy. But analysts have speculated that the company’s only chance for survival is if Khodorkovsky and his associate Platon Lebedev — who like Khodorkovsky is jailed on charges of fraud and tax evasion — and other key shareholders relinquish their shares.
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