Auction of Citgo Parent Shares Criticized

By Marianna Parraga and Gary McWilliams

HOUSTON (Reuters) – Creditors seeking proceeds from a U.S. court-ordered auction of shares in a parent of Citgo Petroleum to compensate them for Venezuela's debt defaults and expropriations criticized the terms of a conditional offer selected in the second bidding round.

An Elliott Investment Management affiliate was named the presumptive winner with a bid valuing Venezuela-owned oil refining company Citgo at up to $7.286 billion.

Amber Energy's bid, contingent upon resolving claims from bondholders, was viewed as the best option to maximize Citgo's value for creditors, according to an attorney overseeing the auction. "Let's get this bid locked down and binding," attorney Ray Schrock stated, emphasizing the need to secure the offer despite some creditors objecting to undisclosed terms.

However, Crystallex, which has the highest-ranked claim against PDV Holding, argued that Elliott's terms would make it unlikely for the $21.3 billion in collective claims to be paid. Amy Wolf, representing ConocoPhillips, noted that the sales process isn't concluding as optimally as hoped.