Oil refiner CVR Energy, controlled by billionaire investor Carl Icahn, has submitted a binding offer in the ongoing auction of shares in the parent company of Venezuela-owned Citgo Petroleum, according to three people familiar with the matter.
CVR, which operates two U.S. refineries in Kansas and Oklahoma, is working with investment bankers at Wells Fargo to raise the financing for its bid. The company has the support of Icahn Enterprises, Icahn’s holding company, in its offer.
The U.S. court in Delaware is auctioning the shares to pay creditors that have $21.3 billion in claims against Venezuela for defaults and expropriations. CVR’s bid is one of several that the court has so far accepted as part of this historic sale process of one of Citgo’s parent companies.
The people familiar with CVR’s bid said the company’s mid-continent oil refineries would make a solid geographic match to Citgo’s refineries in Texas, Louisiana, and Illinois. “The bid advantage that CVR has is its synergies (to Citgo),” one of the sources said.
Other bidders in the auction include trading house Vitol, as well as a group of creditors represented by Centerview Partners, who are aiming to lure ConocoPhillips to join their separate offer. Hedge fund Elliott Investment Management is also reportedly weighing another bid.
The special master of the court is scheduled to inform the parties about the winning bid around July 31. The final hearing on the auction has been postponed to September 19 by U.S. District Judge Leonard Stark, who is leading the case.