RUSSIA - April 16 - BP Increases Its Stake In Sidanco.

BP PLC increases its stake in Sidanco, the country's 7th-largest oil producer, from 10% to 25%. BP has paid $375m for 15% plus one share. The transaction leaves BP's Russian partners, the industrial conglomerates Alfa Group and Access-Renova, with a majority stake. (Sidanco pumps about 380,000 b/d, about 5% of the country's production. The company has reserves of 8.8 bn barrels. BP's new stake increases its own oil reserves by 17%. BP first bought a 10% stake in Sidanco for $484m in 1997. The deal soured when it became clear that previous management, under BP's then-partner, a brassy Kremlin insider, Vladimir Potanin, had taken on hundreds of millions of dollars in debt. The company ended up in bankruptcy court and BP watched helplessly as a key oil subsidiary was snapped up by Alfa Group, Potanin's rival. But the business environment has changed since then. Oil companies, now firmly in private hands, are being upgraded. More managers understand the importance of good relations with shareholders, especially those that seek to sell stock in foreign markets. As a result, foreign direct investment has begun trickling in. BP's purchase follows a $4 bn pledge by ExxonMobil Corp. last autumn to develop vast oil reserves off of the Far Eastern coast. And executives from Royal Dutch/Shell Group visited Gazprom on April 16, renewing an alliance with the giant gas producer that had stagnated since 1997).