Todd Boehly, through a consortium including his Xtellus venture and UAE's Allied Investment Partners, has garnered support from the US government and Gulf-linked investors for a bid to acquire Lukoil's international assets. This move challenges an earlier agreement where Carlyle had planned to purchase the assets. The consortium includes backing from the US International Development Finance Corporation (DFC), Sheikh Tahnoon bin Zayed al-Nahyan, and Qatar's Al-Khayyat family. The DFC is expected to take a mid-teens equity stake in the new company, with Sheikh Tahnoon's International Holding Company leading the consortium alongside Allied Investment Partners.
Lukoil's international portfolio, valued at approximately $20 billion (though some sources suggest around $22 billion), includes oil and gas fields, refineries, and over 2,000 fuel stations globally. Notably, these assets encompass a 75% stake in Iraq's West Qurna 2 oilfield, which is among the world's largest, and significant refining assets in Bulgaria and Romania. The portfolio offers access to more than 3 billion barrels of proven and probable reserves across Central Asia, Mexico, and Europe.
The bid is complicated by the fact that the US government, through the DFC, is backing Boehly's consortium, while other US agencies are responsible for approving any transaction related to the sanctions-hit Russian company. This dual involvement creates uncertainty for Carlyle, which had an agreement in January, and raises regulatory concerns regarding the transaction's approval. A previous bid strategy involving a swap of frozen Lukoil shares held by US investors was rejected by the US Treasury, indicating the complexities of securing final approval.
Boehly's group is pursuing escalation and licensing to proceed, despite the US Treasury having not yet approved their prior attempt. The current license for operations related to the sale of Lukoil International GmbH was recently extended until October 22. This situation adds scrutiny to Boehly's broader investment network, including his involvement with Kansas-based Security Benefit, a major annuity seller, and his insurance holdings which are already under examination in a probe involving business partner Mark Walter. The White House, UCC, and Boehly have declined to comment on the matter.
