Shock new government tax claims of $10 billion (€7.9 billion) knocked ailing Russian oil giant Yukos's shares down 17.5 per cent yesterday as prospects for the company's survival appeared to dim.
Analysts said the market was now braced for further deadly blows from the government to be levelled against Yukos subsidiaries other than its main production unit Yugansk, which would destroy any residual value left in the company.
"A zero value scenario for Yukos is very much on the cards now," added Mr Steven Dashevsky, oil analyst at Aton brokerage.
A source familiar with Yukos's tax bill said the company was presented with fresh tax demands of $6.7 billion in back taxes for 2002. That is in addition to around $7.5 billion for 2000 and 2001, of which Yukos says it has already paid $3.5 billion.
Yukos also confirmed its main unit Yugansk, which produces 1 million barrels per day or 62 per cent of total output, had been handed demands for $3.4 billion in a move that will further reduce the unit's worth if sold to pay the tax debt.
The news sent Yukos's dollar-denominated shares, widely held by foreign investors, tumbling 17.5 per cent and rouble shares down 10 per cent to below the psychological barrier of 100 roubles at 95.40.
Analysts said fresh tax claims on Yugansk appeared geared for a planned government auction of its assets for which a date has yet to be announced officially. The market now expects the government to get its latest claims to be judged due and payable by courts before any sale.
"This will ensure that even after Yugansk is sold ... there will still be unpaid claims on the basis of which the assets and bank accounts of Yukos will remain frozen," said United Financial Brokerage in a research note.
Ripping out Yukos's core asset is widely viewed as the centrepiece of a Kremlin strategy to destroy the business empire of its politically ambitious former chief Mr Mikhail Khodorkovsky, who is on trial for fraud and tax evasion.
The prosecution in his trial rested its case on Tuesday and adjourned proceedings until November 9th, court sources said.
