Lukoil aims for SPO in Hong Kong, may retire portion of treasury stock
MOSCOW. Nov 27 (Interfax) - Lukoil aims to place shares on the exchange in Hong Kong, given the difficulties faced on Western exchanges, but the Russian oil major may also decide to retire a portion of its treasury stock, Vice President Leonid Fedun said.
Lukoil is seeing "certain complications on Western capital markets, since the loan committees are often 'once bitten twice shy,' even though our company faces no financial restrictions," Fedun said.
"Nonetheless, these problems exist, so for us the mainline is getting a listing on the Hong Kong exchange. At present the so-called highway between the Hong Kong and Shanghai exchanges has been implemented and that gives us the opportunity to go to a market with overall capitalization of about $5.5 trillion," Fedun said.
"Since Lukoil has a significant set of projects with Chinese companies, this gives us optimism that we will move in this direction fairly intensively. We reckon that by the middle of next year all the formal restrictions on entering the Asian exchanges will be lifted. The Central Bank is working intensively in this direction," he said.
Asked whether placement of treasury stock on the Hong Kong exchange was the only option being considered for those shares, Fedun said: "Yes. Hong Kong is our target. But at the same time we do not rule out retiring some portion of the shares, as soon as the economic conditions for this take shape and all of the legal considerations are taken into account."
Lukoil holds 11.3% of shares as treasury stock in Cyprus-registered companies, including 10.79% in LUKOIL Employee Limited.
Lukoil previously said it planned to list shares in Hong Kong in 2015, raising $1 billion in the SPO.