Sibur Holding Progressing with Amtel-Vredestein Deal

An article published by the Moscow Times appears to confirm speculation that Sibur Holding will acquire control of Amtel-Vredestein. The January 26 news piece prints comments from a company executive that Sibur will issue bonds as part of the deal, a possibility previously reported by Russian business daily Vedomosti.

The previous merger arrangement was cancelled last September due to an unavailability of credit to fulfil the necessary terms and conditions. However, Amtel-Vredestein’s press department in Moscow told Tyres & Accessories on September 30 that the deal was still “an ongoing work in process.”

According to Igor Karavayev, deputy general director of Sibur-Russian Tyres, the company planned by early February to issue bonds that could be converted into shares in Sibur-Russian. “They will be one of the instruments used in carrying out the deal with Amtel-Vredestein,” said Karavayev. “We are continuing negotiations and have no intention of pulling out.”

Last year Sibur-Russian Tyres CEO Vadim Gurinov stated that the company that would emerge from a deal between his company and Amtel-Vredestein could boast annual sales of around US$2 billion. The 2008 deal was designed to allow Sibur-Russian Tyres to gain control of a 60.5 per cent stake in its competitor. It is not clear how the current arrangement will differ from that on the table last year.