Court Officer’s Representative Reports Multiple Competitive Bids in Citgo Parent Auction

By Marianna Parraga

HOUSTON (Reuters) – The second round of bidding for shares in Citgo Petroleum’s parent company was described as “successful” after a U.S. federal court received several competitive offers last month, according to a representative of the court officer managing the sale process.

This case aims to pay up to $21.3 billion to creditors due to previous expropriations and debt defaults in Venezuela. It was initiated by the miner Crystallex in 2017, enabling multiple companies to pursue financial returns from the auction organized by the court.

Representatives for Venezuela labeled the initial bidding round in January as “disappointing,” as the top offer stood at $7.3 billion, falling short of an estimated valuation of between $11 billion and $13 billion for the seventh-largest U.S. refiner owned by Venezuela.

Details about the bidders and their offers from the second round were not disclosed during a court hearing on Tuesday. A lawyer representing Citgo and its parent company, PDV Holding, mentioned that these firms had not been privy to the identities of the bidders.

Citgo and the boards overseeing the refiner did not respond to requests for comment.

Last month, the Canada-based miner Gold Reserve indicated that it had submitted a credit bid. Additionally, trading house Vitol and refiner CVR Energy were reported to have participated in the second round.

Recently, financial partners began offering support for some bids, with institutions such as JP Morgan, Morgan Stanley, Rothschild & Co, and Wells Fargo reportedly involved.

The bidding landscape has proven to be intricate, with many proposals combining cash and credit components.

Delaware judge Leonard Stark granted a motion to postpone the case’s final hearing to September 19, allowing more time to review bids and select a winning offer, which is expected to be announced around July 31.

The U.S. Justice Department released a letter this week advocating for an extension of the sales process to ensure no interference occurs with Venezuela’s presidential election scheduled for July 28, as indicated by one of the lawyers representing the Venezuelan parties during the hearing.