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Last Updated: Tuesday, 27 March 2007, 10:31 GMT 11:31 UK
Rosneft wins first Yukos auction
Yukos plant in Siberia
The collapse of Yukos raised concerns among many foreign investors
Russia's state-controlled oil company Rosneft has won the first auction of assets from bankrupt oil firm Yukos.

Rosneft bid 197.8bn roubles ($7.6bn; 3.9bn) for 9.4% of its own shares, beating an offer from a joint venture between Russia's TNK and Britain's BP.

The winning bid was 10% less than the current value of Rosneft's shares.

It was the first in a series of auctions, including seven due to take place in April, that aim to liquidate $22bn-worth of Yukos assets.

Fall from grace

Also going under the hammer, will be five Russian oil refineries and 400,000 barrels of daily oil production.

The receiver, Eduard Rebgun, has valued the assets at around $22bn.

Yukos owes the government $26bn in back taxes, and said its assets are worth more and at least enough to pay off the debts.

The company said that the tax claims against it are the Kremlin's revenge for the political activities of its former head Mikhail Khodorkovsky, who is serving an eight-year jail term in Siberia for fraud and tax evasion.

Mr Khodorkovsky's lawyers are in the process of appealing to the European Court of Human Rights.

Bruce Bisamore, a former chief financial officer of Yukos, accused the Russian authorities of rushing the auction through before the appeal could be heard.

"While the case is going on, and while the determination is being made, I think it's questionable as to the legitimacy of the auction," he said.

Taken over

Yukos was once Russia's second-biggest oil company, pumping one in every five barrels the country produced.

In 2004, the back tax bill led to Yukos' main Yuganskneftegaz subsidiary being expropriated by the government and sold off at auction.

It was ultimately acquired by Rosneft.

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