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LONDON -- BP (LSE: BP.L ) has long had problems with TNK-BP, which it formed in 2003 by merging its Russian assets with those of Alfa Access Renova. So it wasn't a particular surprise that it put its half of TNK-BP up for sale a couple of months ago, given its recent focus on streamlining its overall business.
It's still unclear what amount BP will get, but after today's announcement that the Russian state oil company Rosneft has entered the fray, the prospects of it getting a decent price look a lot better.
AAR still has first refusal on the business, but the clock started ticking on its preferred bidder status on July 18, giving them 90 days before BP can sell the business to a third party.
At the moment, AAR has indicated that it is willing to pay up to $10 billion to raise its stake in the business from 50% to 75%. BP, obviously, would prefer to get shot of its entire 50% stake, otherwise it will be left with a 25% minority holding that will be a lot more difficult to sell.
The market gave the news of Rosneft's interest a cautious welcome, with BP shares gaining 1% to 435 pence, giving it a current market value of 83 billion pounds.
TNK-BP accounted for about a sixth of BP's profits in its latest quarterly results, so it's a significant part of BP's overall operations. We'll find out some more up-to-date figures when the FTSE 100 (UKX) company reports its second-quarter results on July 31.
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