Serinus’s share in KUB-Gaz is being purchased by Burisma

Burisma Group announced on Feb. 1 it is in the process of closing the acquisition of a 70% stake in KUB-Gaz from Serinus Energy (SEN PW). Serinus announced on Dec. 23 that it reached an agreement with an undisclosed private buyer to sell the stake for USD 30 mln. Shortly thereafter, Canadian Cube-Energy (KUB CN), owner of a 30% stake in KUB-Gaz, reported it was willing to use its first refusal right to buy the 70% stake.

Burisma is a private natural gas producer operating in Ukraine, with a non-transparent ownership structure. Previously, its owner was thought to be an Ecology Minister in the Yanukovych government. The holding is known for its famous board members, including ex-president of Poland Alexander Kwasniewski, and the U.S. vice-president’s son, Hunter Biden. Burisma’s companies produced 773 mcm of natural gas in Ukraine in 2015, while the targeted KUB-Gaz produced 238 mcm.

Alexander Paraschiy: This news looks negative for Cube-Energy, which seems to have lost its opportunity to acquire a 100% stake in KUB-Gaz, for a bargain price.  This is no surprise, given that Serinus did not look ready to sell the stake to Cube-Energy. We believe that because Serinus Energy and some of Burisma’s directors have Polish roots, it was easy for them to make an arrangement. The reaction from Cube-Energy on Burisma’s announcemet might follow later today, but we do not believe it would change the deal.