A US court officer said Monday that an affiliate of hedge fund Elliott Investment Management has submitted the highest bid for PDV Holding, the parent of Citgo Petroleum, overtaking a rival offer from a group led by Canadian miner Gold Reserve, as per a Reuters report.
The development marks a potential turning point in the lengthy auction process, which could have significant implications for Citgo, the United States’ seventh-largest oil refiner.
In a court filing, auction officer Robert Pincus said Elliott affiliate Amber Energy had outbid Gold Reserve-owned Dalinar Energy to take the lead.
Dalinar’s $7.4 billion proposal had been declared the winning bid just last month, but Elliott’s latest submission reshaped the contest.
Improved offers in the final stage of the auction
The PDV Holding auction has entered a decisive stage following a series of court rulings that opened the door for fresh offers aimed at boosting creditor recoveries.
Amber Energy, an affiliate of Elliott Investment Management, submitted an improved bid on August 22 that pushed it ahead of rival Dalinar Energy, owned by Canadian miner Gold Reserve.
Court filings show that Dalinar now has three business days to match or surpass Amber’s proposal to remain in contention.
If it does not, auction officer Robert Pincus could recommend Amber as the winning bidder.
The final decision rests with Delaware Judge Leonard Stark, who has scheduled a sale hearing for mid-September.
His ruling will determine whether Elliott’s Amber Energy secures the asset or Dalinar reclaims the lead.
Amber’s offer and creditor support
Pincus did not disclose full details of Amber’s new proposal, but earlier filings showed the company had proposed $5.86 billion in payments to the creditors.
The plan also offers to settle with holders of a defaulted Venezuelan bond tied to Citgo equity, a deal that would dismiss $2.86 billion of claims against PDVSA, Citgo’s ultimate parent and state-run owner.
According to the filings, the bid, which is supported by creditor Koch, consists of a mix of cash and non-cash considerations.
Stakes for Venezuela’s creditors
The auction represents a watershed moment for at least 15 creditors who have sought restitution in US courts since 2017.
Their claims, which come from Venezuela’s asset confiscation and subsequent financial defaults, total roughly $19 billion.
The sale of PDV Holding provides one of the remaining realistic options for these creditors to seek reimbursement.
Citgo, a US-based refining and marketing corporation, is regarded as one of Venezuela’s most valuable abroad assets.
The sale proceeds are projected to pay only a portion of the total claims, although they may provide significant compensation to a small number of claimants.
The post Elliott affiliate tops rival bid for Citgo parent in US court auction appeared first on Invezz
