Published by Global Banking & Finance Review®
Posted on December 11, 2025
3 min readLast updated: January 20, 2026
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Lukoil prefers Xtellus' cashless bid for its $22 billion global assets, involving a securities swap, amid U.S. sanctions.
By Dmitry Zhdannikov
LONDON, Dec 10 (Reuters) - Russia's Lukoil favours U.S. bank Xtellus Partners' bid for its global assets over a dozen rival bids, as it takes the form of a cashless deal that would return U.S.-held securities to the Russian oil company, two sources familiar with the process said.
The U.S. Treasury extended the deadline for Lukoil to sell its global portfolio, valued at $22 billion, to January 17 after it imposed sanctions on Lukoil and on Rosneft, another Russian oil company, to put pressure on Moscow to agree a peace deal with Ukraine.
Xtellus has offered to organise a swap of Lukoil securities held by U.S. investors in a cashless deal to return them to Lukoil in exchange for the Russian company's global assets, the two sources said this week. They declined to be named because of the sensitivity of the issue.
Xtellus declined to comment. Lukoil did not respond to a request for comment.
U.S. asset managers, including BlackRock, JPMorgan and Goldman Sachs, lost billions of dollars when they had to first freeze and then write off their stock holdings in Russian firms, including Lukoil, after Russia invaded Ukraine in 2022.
Lukoil's global assets, which include upstream oil and gas projects, refining and more than 2,000 filling stations, have attracted bidders from U.S. private equity giant Carlyle to oil major Chevron.
XTELLUS DEAL IS MORE COMPLEX THAN OTHERS
Lukoil tasked Pavel Zhdanov, its vice president for finance, with leading talks with potential bidders, the two sources and two other sources involved in the talks said.
Should Xtellus agree a deal with Lukoil, it would have to apply for U.S. Treasury clearance to proceed, according to guidance issued by the Treasury for bidders in November.
The deal with Xtellus is more complex than other bids as it includes Lukoil's stock and would require disclosures of who owns the shares, three out of the four sources said.
Until March 2022, Lukoil was included in emerging stock market indexes that are used as benchmarks by major investors and exchange-traded funds and who bought Lukoil stock.
Russian investors also held shares in domestic companies via internationally traded derivatives.
US CONDITIONS AND THE COMPLICATION OF RUSSIAN APPROVAL?
The U.S. Treasury has said it wanted any Lukoil asset sale to support U.S. national security and foreign policy objectives, sever ties, avoid providing any windfall to Lukoil and to block funds to Lukoil until sanctions are lifted.
Another complication with the share swap is that it may require approval from Russian President Vladimir Putin, who banned all Russian shares from trading abroad in 2022, two out of the four sources said.
In the event Lukoil cannot agree a deal before the U.S. deadline expires, the assets could be left in limbo and could be confiscated by local authorities. Lukoil could also begin litigation if and when sanctions are lifted.
(Reporting by Dmitry Zhdannikov; Additional reporting by Anna Hirtenstein; Editing by Barbara Lewis)
A cashless deal is a transaction where no physical cash is exchanged. Instead, assets or securities are swapped, allowing parties to complete a transaction without direct monetary payment.
Asset management is the systematic process of developing, operating, maintaining, and selling assets in a cost-effective manner. It involves managing investments on behalf of clients.
A stock swap is a financial transaction where one company's stock is exchanged for another company's stock. This can occur during mergers, acquisitions, or other corporate restructuring.
A portfolio is a collection of financial investments like stocks, bonds, commodities, and cash equivalents. It is managed to achieve specific financial goals.
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