Shareholders Quarrel, TNK-BP CEO Quits
Published: May 30, 2012 (Issue # 1710)
MOSCOW — Russian tycoon Mikhail Fridman on Monday unexpectedly announced his resignation as chief executive of TNK-BP, a sign of rising tensions between shareholders at the Russian venture of British company BP.
TNK-BP, which is owned in equal parts by BP and a group of Russian billionaire shareholders known as AAR, said in a statement that Fridman is due to step down as CEO and chairman of the board in 30 days. It did not specify the reason, but BP’s representative in Russia, Vladimir Buyanov, cited “personal reasons.”
Fridman is considered one of the most influential people in the venture. He has been at TNK-BP’s helm since 2009 and was to head it through 2013.
TNK-BP has been plagued by shareholder conflicts since it was formed in 2003, and Fridman’s appointment as the chief executive three years ago looked like a sign of reconciliation between two rival groups of shareholders.
But those tensions seemed to resurface last year, when a potentially huge deal BP was hoping to sign with Russian state-owned firm Rosneft to extract oil in the Arctic broke down after AAR blocked it, claiming BP should be pursuing such deals through TNK-BP.
A source close to the Russian shareholders told the Associated Press on Monday that Fridman resigned because the equilibrium between BP and AAR’s investors has been lost and can no longer be maintained. The source, who asked not to be named because of the sensitivity of the issue, said TNK-BP management “was not prepared to work in an environment of constant pressure and mistrust from BP’s side” and that “BP has lost the trust and credibility of AAR.”
The source claimed that BP has attempted to interfere directly with decision-making at TNK-BP by threatening the management with legal action if their decisions are not approved by BP.
The source, however, insisted that AAR is committed to its investment in TNK-BP and did not contemplate selling its stake.
TNK-BP’s board of directors hasn’t met since December and has been unable to replace two directors who resigned in December. Without a quorum on the board, the company was forced to cancel plans of distributing dividends.
The company said that while it searches for a replacement for Fridman, it will be run by “a group of executives who hold powers of attorney related to their areas of responsibility.”
BP sought to play down the importance of Fridman’s resignation, saying he was not involved in day-to-day operations. Buyanov said BP has pledged to work with AAR to appoint a replacement “as soon as reasonably possible.” AAR did not comment on the matter.
TNK-BP’s shares on Moscow’s MICEX stock exchange dipped immediately after the announcement but recovered later to hover 1.3 percent higher than Friday’s close, in line with the market.