US court analyzing 12 preliminary bids in Citgo share auction

By Thomson Reuters Feb 27, 2024 | 10:08 AM

By Marianna Parraga and Tom Hals

HOUSTON/WILMINGTON (Reuters) – A U.S. federal court is weighing 12 initial bids from private investment funds and companies participating in an auction of shares of refiner Citgo Petroleum’s parent, a court officer said in a hearing on Tuesday.

Creditors claiming billions of dollars for past expropriations in Venezuela and defaulted debt have flocked to U.S. courts to have arbitration awards and rulings enforced through an auction shares in a parent of the South American country’s foreign crown jewel, Houston-based oil refiner Citgo Petroleum.

Claims before the court exceed $22 billion, much greater than the $11 billion-$13 billion market value estimated for Citgo.

The court and investment banker Evercore Group selected to market the shares initially identified 90 parties that could participate in the first bidding round, which received bids through Jan. 22, officials said.

About 30 parties signed non-binding agreements and received relevant information and a Citgo financial model, and 12 parties submitted indications of interest, a representative for court officer Robert Pincus said in the hearing. The bidders were not identified because the court has sealed the bidding process.

“The indications of interest are quite disappointing. And we’re working hard to see if they can be raised, but we have a great deal of concern and where we are at this point,” said a lawyer representing Houston-based refiner Citgo and its parent PDV Holding.

Citgo requested extra time to analyze the proposals, which was granted by U.S. Judge Leonard Stark.

(Reporting by Marianna Parraga and Tom Hals; editing by Gary McWilliams)