Russian oil giant Lukoil to acquire Finnish oil company Teboil

Teboil General Manager believes name of distribution chain will not change

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The owner of Finnish oil company Teboil is about to change, as Russian oil giant Lukoil has signed a preliminary agreement on the purchase of the outstanding shares of Teboil and its affiliated company Suomen Petrooli.
      The seller of the shares is named Nafta Moskva. In the report of a study conducted at the Turku School of Economics, the company is described as a holding company that was created in the Russian privatisation wave of the 1990s. It is domiciled in Switzerland, and its shareholders are Russian private citizens.
     
Through the deal, Lukoil will gain access to the Finnish market for its own fuel. Lukoil plans to import both petrol and fuel oil to Finland.
      Up until now, Finnish oil product distributors have bought their petrol and diesel primarily from Fortum, and Teboil has also been among Fortum's customers.
      It is a part of Lukoil's strategy to increase its share in the distribution chain of oil products that it manufactures.
      The sales agreement concerning Teboil and Suomen Petrooli shares requires the approval of the EU Commission.
     
Boris Diyachenko, the General Manager of Teboil and Suomen Petrooli, sees the cooperation possibilities offered by Lukoil as a benefit.
      In the report on Teboil published by the Turku School of Economics, the researchers write that it would improve Teboil's outlook if a strategic buyer considered the company valuable enough to develop it further and invest money in it.
      According to Diyachenko, the Teboil name should remain at filling stations as well as on the sides of tank trucks and oil canisters. "This company is 70 years old. The brand is well known in Finland."
     
Both Teboil and Suomen Petrooli, a storage and transport company, have been in Russian hands since the 1940s. Diyachenko emphasised that the companies will operate as Finnish firms in the future as well. He declined to mention any possible market share targets of Lukoil.
      Of the Teboil chain of nearly 300 filling stations, the majority are run by private entrepreneurs. According to the General Manager, the change of ownership will not affect their status.
      Lukoil is the second-largest company in Russia, with operations in 25 countries. Teboil's market share in oil product sales in Finland is 23 percent, making it the second-largest player in the field in Finland.


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