Refueling at Gutseriev’s. RussNeft Buys Grand, Biggest Independent Retail Network in Moscow.

As the Vedomosti has come to know company RussNeft headed by Mikhail Gutseriev is buying the biggest in Moscow independent retail network called Grand. It is one of the major deals at the metropolitan petrol stations market for the entire period of its existence. Experts estimate its amount as reaching $100 million.
RussNeft is going to complete the deal on acquiring Grand network within the coming few day, the Vedomosti was informed by a source close to Gutseriev. The source also added that the acquisition will cost nearly $100 million to the oil company. According to the interlocutor of the Vedomosti, the seller is a German fund of which one of the shareholders is General Director and co-owner of Rosgosstrakh Danil Khachaturov. A few years ago Gutseriev already owned Grand but later sold it out on the assumption that he would have his own oil company, the source says. Right now Gutseriev is redeeming the petrol stations. The source also informs that fuel for the petrol stations will be bought at the market as before, mostly from Moscow Refinery and Yaroslavlnefteorgsynthez.
However another source close to the deal assures that Gutseriev has never been an owner of Grand, the network has always been in the possession of Khachaturov and his partners. As for Gutseriev, according to this source, he got the option of buying out Grand shares while president of state-run company Slavneft when it entered into a franchise agreement with Grand. ‘Just now this option has been put into practice,’ concludes the interlocutor of the Vedomosti. However the amount of the deal is different from the one cited by the source close to Gutseriev $100 million.
Gutseriev and Khachaturov as well as Grand General Director Eugene Arkusha have neither confirmed nor declined the information having refused to comment. As estimated by Moscow Fuel Association’s executive director Gregory Serguiyenko, the share of Grand in Moscow’s retail market of fuel is 8.5%. Its amount is assessed by the expert as ranging from $2.7 to $2.9 billion. He also says that the petrol stations of this network have recently been either constructed or soundly updated. Moreover most of them are favorably located. According to the estimation of Serguiynko only Moscow’s portion of Grand costs $70-90 million.
Hitherto the biggest deal at Moscow’s petrol market has been the 2000 buy-out of Moscow Fuel Company’s assets from Most Group’s structures by the Municipal Central Fuel Company. For the strategically fraught Paveletskaya oil tank farm and about one hundred petrol stations were paid nearly $100 million.
A manager of a big oil company working at the metropolitan market is sure that Grand is worth much more than $100 million. According to him, only one year ago petrol stations in Moscow were offered at $600 000, but now there are no prices lower than $1.5 million. “If applied to Grand it is already $97.5 million only over the area of Moscow,” he calculates. “To this should be added 10-15% premium for the fact that the objects belong to a big network. [Basing on the amount of the deal equal to $100 million] it turns out that regional petrol stations mean some bonus for Russneft, - reasons the interlocutor of the Vedomosti.
The retail network branded Grand numbers about 90 petrol stations, 59 of them are in Moscow, six in the Podmoskoviye and the rest are in Sochi. In 2000 when the network included only 23 petrol stations it entered into a commercial concession agreement with Slavneft and from then on has used its logotype along with own name. The owner of the network is Association Grand ZAO. 
According to the latest report data submitted by the company to the Federal Securities Commission, as of the 30th of September 2003 five limited liability companies, whose owners are not known, possessed 20% stake each. The earnings of Grand Association made up $64.2 million and the losses $71 thousand.
RussNeft was established in September 2002. It was possessed by Mikhail Gutseriev and his partners. The company includes more than 20 small oil producers with total reserves not exceeding 300 million tons. As a financial partner of RussNeft has acted a Swiss trader named Glencore. In 2004 RussNeft produced 6.6 million tons of crude oil. The earnings for the nine months of 2003 came to 4.2 billion rubles.