OREANDA-NEWS. February 24, 2010. Southern Generation Company TGK-8 has offered to buy shares from minority shareholders in Astrakhan Energy Retail Co. (RTS: ASSB) at a price of RUB 0.9475 per share. Lukoil Group controls about 89% in the energy retailer through its affiliates TGK-8 and Trade House Energoservice. As part of the offer, TGK-8 could buy out up to 11% in the retail company.

The retailer’s shares now trade with a 5% discount to the buyout offer price. In our view, ASSB shares arouse no interest as an investment vehicle, as growth in quotes for company shares would be capped by the buyout offer price. In our view, Lukoil Group should be able to consolidate over 95% in the retailer as part of an obligatory buyout offer, after which a forced buyout offer could be made. Shareholders are therefore advised to take advantage of this offer.