Chaparral Resources Litigation Update: Lukoil’s Settlement Payment Coming Soon

March 13, 2008

The settlement of the shareholder litigation after Lukoil (ticker: LUKOY) bought out the minority shareholders of Chaparral Resources, Inc. has been approved by the court this morning. We documented the litigation and Lukoil’s egregious behavior in September 2006, and wrote about the settlement this January.

The net settlement available for public shareholders should come to $1.80 per share. This represents a 31% increase over the price Lukoil paid minority shareholders and shows quite clearly the success, albeit temporary, of the oil giant’s attempts to depress Chaparral’s stock price. Eligible to receive it are only shareholders who held Chaparral stock at the closing of the merger in September 2006. Anyone who sold before the closing will not be eligible to receive a payment.

Claim forms must be received by the claims administrator by April 12. Payment should be made shortly thereafter, but the exact timing will depend on the number of claim forms that need processing.

Thomas Kirchner manages the Pennsylvania Avenue Event-Driven Fund (PAEDX), which owned shares in Chaparral Resources, Inc. through the closing of the merger.

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Chaparral Resources Shareholders Have Last Laugh As Lukoil Settles Litigation

January 22, 2008

LukoilOverseasRussian oil giant Lukoil’s (ticker: LUKOY) buyout of the minority shareholders of Chaparral Resources, Inc. has been marred by allegations of serious wrongdoing and fraud that came to light during discovery in shareholder litigation, which we wrote about in September 2006. More than one year later, Lukoil has agreed to settle the litigation by paying over $36 million to the former shareholders of Chaparral Resources. Read the rest of this entry »

W Holdings Takes Hit On Inyx Bankruptcy

July 19, 2007

W HoldingsW Holdings (ticker WHI) market cap took a half billion dollar bath after its loan to Inyx (ticker IYXI) turned out to have been a classic lending debacle, where good money is thrown after bad. Its Puerto Rican subsidiary Westernbank is the biggest lender to Inyx, and recently filed for receivership of Inyx’s U.K. unit, which is equivalent to a chapter 11 in the U.S. Inyx responded by placing its U.S. businesses into chapter 11, sending its stock to penny levels.

Inyx got started when the wife of Armenian-Canadian businessman and Inyx CEO Dr. Jack Kachkar acquired a public shell company with the intention of Read the rest of this entry »

Chaparral Resources Buyout Highlights Lukoil’s Questionable Tactics

September 18, 2006

LukoilOverseasRussian oil giant Lukoil’s attempt to buy out the minority shareholders of Chaparral Resources, Inc. (CHAR.OB) raises serious concerns about shareholder rights and the treatment of outside investors by the first Russian company to list on the London Stock Exchange — one that claims to be a model for openness and transparency.

Over the last few years, Lukoil, described by many observers as an extended arm of the Kremlin, has tried repeatedly to expand its operations in Kazakhstan, which it views as strategically important for its vast oil reserves. Last year, it lost the $4.2 billion takeover battle of Canadian PetroKazakhstan to the Chinese National Petroleum Company. Read the rest of this entry »