Embattled Russian oil firm YUKOS and its shareholders have rejected a demand from junior merger partner Sibneft for management control of the combined firm, a YUKOS source said.
Sibneft's core shareholders, led by Chelsea owner Mr Roman Abramovich, have already been paid $3 billion plus an $8 billion 26 per cent stake in the combined group for their 92 per cent shareholding in Sibneft by the core shareholders of larger YUKOS.
But the Sibneft camp suspended the deal on Friday, just as a new board was about to be sanctioned for what would be the world's fourth-largest oil company by production.
The move has piled the pressure on YUKOS, whose top shareholder Mr Mikhail Khodorkovsky, a political opponent of President Putin who has been jailed on charges of fraud and tax evasion. YUKOS offices have also been raided by state prosecutors and the company has received threats to remove drilling licences.
YUKOS shares dropped 5 per cent by midsession in Moscow before recovering to stand down 2.7 per cent at $11.05.
Analysts are divided about whether Mr Abramovich was pressured into Friday's merger suspension by a Kremlin keen to increase pressure on Mr Khodorkovsky, whether it was an independent move to take greater control of the merged firm, or whether Sibneft simply wants to break away from its troubled partner.