Russia Picks Intesa for Rosneft Sale as Sanctions Hurt Market

Russia has selected Intesa Sanpaolo SpA as its consultant for the planned sale of shares in the country’s biggest oil producer, Rosneft OJSC, which is under U.S. and European financial and technical sanctions.

Italy’s second-largest bank will advise Russia on the sale of 19.5 percent in the oil company worth about 700 billion rubles ($10.5 billion) now, the Economy Ministry’s press service said, confirming comments the minister, Alexei Ulyukayev, made to reporters in Bratislava, Slovakia, on Tuesday. Russian banks will also most likely participate in the deal, Ulyukayev said, without elaborating on the plans or timing.

The U.S. and Europe have frowned on western banks participating in Russian offerings, creating hurdles for a sovereign Eurobond sale, even though the government isn’t sanctioned and the restrictions that cover Rosneft don’t prohibit equity investment in the company. Last month, Russia chose New York-headquartered White & Case LLP to serve as a legal adviser in the sale.

Intesa’s press service declined to comment by phone.

Russian President Vladimir Putin said in April that the country would push ahead with the Rosneft sale, regardless of the market downturn, if it found a strategic partner willing to pay generously. The government will find it difficult to hold the budget deficit to a targeted 3 percent of gross domestic product this year without proceeds from the stake in the oil producer, Ulyukayev said.

To contact the reporter on this story: Elena Mazneva in Moscow at emazneva@bloomberg.net. To contact the editors responsible for this story: Lars Paulsson at lpaulsson@bloomberg.net, Torrey Clark