LONDON (Reuters) - Former BP (BP.L) boss Tony Hayward and financier Nat Rothschild said they had raised 1.35 billion pounds from investors to create a bid vehicle to target emerging market oil assets.
Vallares, as the company will be known, aims to make a reverse takeover of an unlisted oil group in an emerging market, which needs money to develop its assets.
Vallares effectively offers a target, whose owners may end up with a majority stake of the listed company, a fast track route to a stockmarket listing and, thereby, the ability to raise money more cheaply than they currently can.
The vehicle has two years to strike a deal, or to return the cash to investors, and will begin unconditional trading on the London Stock Exchange on June 22, the company said on Friday.
The listing of emerging markets companies on Western markets has come under scrutiny in recent weeks, with accusations that corporate governance practices are below those usually expected by investors.
Shares in Toronto-listed Chinese forestry group Sino-Forest TRE.TO have collapsed in the past two weeks after allegations of fraud.
Four non-executives at London Stock Exchange-listed Kazakh mining group ENRC ENRC.L departed last week, with two criticising the company’s corporate governance.
China’s Longtop Financial Technologies LFT.N, China MediaExpress Holdings Inc CCME.O and others were hit recently by accusations of accounting fraud, including from short-sellers or regulatory probes.
Julian Metherell, one of the founders, and a former senior Goldman Sachs banker, said such concerns were addressed by a voting cap which would limited any one Vallares shareholders’ voting rights to 29.9 percent.
Metherell added that Vallares’s high profile board, which includes Hayward, who stepped down last year amid criticism of his handling of BP’s response to the Gulf of Mexico oil spill, and Jim Leng, former chairman of steel maker Corus, would also help ensure all investors interests were defended .
Rodney Chase, deputy CEO at BP under Hayward’s predecessor, John Browne, is chairman of Vallares.
Metherell said investors had not been deterred by the participation of Hayward, who became a hate figure in the U.S. following gaffes he made about the spill. The shareholder base includes long-only investment funds on both sides of the Atlantic, hedge funds and sovereign wealth funds.
Vallares echoes Vallar, a structure Rothschild, scion of the famous banking family, created last year to focus on coal assets.
Vallar is in the process of buying control of two Indonesia-focussed mining ventures from companies within the indebted Bakrie Group, in return for giving the politically-connected Bakries around half of Vallar.
Indonesia’s stock exchange said in July it would fine three Bakrie firms including Bakrie & Bros (BNBR.JK) for failing to explain discrepancies in their financial reports. A unit of Bakrie-controlled Pt Bumi Resources (BUMI.JK) has been probed for alleged tax evasion, a charge it denied.
Metherell defended Vallares’s structure of remunerating founders with special shares and performance incentives which will net them hundreds of millions of dollars if a target is found, saying the success of the fundraising shows fund managers consider it fair.
The Vallares announcement confirmed a Reuters story on Thursday which said the deal, which was expected to close next week, would close early and that the initial target of 1 billion pounds would be exceeded.
Additional reporting by Kylie McLellan, Clara Ferreira-Marques; Editing by Hans-Juergen Peters