Moody's may cut Sibneft

Moody's Investors Service said it maintained Sibneft's Ba2 senior implied and Ba3 senior unsecured ratings on review for possible downgrade following the recent reduction in Yukos' stake in Sibneft from 92% to 34.5% in response to the invalidation of a Yukos' share issue, through which Yukos had partially acquired 92% in Sibneft in 2003.

Moody's acknowledges that the reduction in Yukos' stake has removed some of the concerns about Sibneft becoming entangled in the substantial claims against Yukos for back-dated tax payments, which threaten to potentially bankrupt Yukos.

However, Moody's said its decision to leave Sibneft's ratings on review for downgrade is also based on Yukos' ability to retain a 34.5% stake in Sibneft, that the remaining stake may still expose Sibneft to potential litigation from tax authorities and investors and that Yukos is said to be claiming back $3 billion in cash for the purchase of the remaining 20% in Sibneft.

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