Lukoil to pay $93 million to settle Getty petroleum suit
MOSCOW -- Lukoil has agreed to pay $93 million to settle a lawsuit stemming from the collapse of Getty Petroleum Marketing. The lawsuit accused the Russian oil company of stripping the most valuable assets from the defunct U.S. gas-station operation and putting it on the path to bankruptcy.
Lukoil had previously defended itself against accusations that it plundered Getty Petroleum, saying it had invested $25 million to revive the company before selling its assets to an entity called Cambridge Securities LLC in 2011. Lukoil instead blamed Getty Petroleum's 2011 bankruptcy filing on former affiliate Getty Realty and defunct supplier Bionol Clearfield.
An attorney for Lukoil declined to comment on the settlement, which requires court approval. The U.S. Bankruptcy Court in Manhattan, which is overseeing the Getty Petroleum Chapter 11 case, is set to consider the deal at a July 29 hearing.
Getty Realty, which regained control of Getty Petroleum's gas-station properties last year, bankrolled the lawsuit with a $6.7 million loan and is expecting to reap about $32 million from the settlement. Getty Realty separated from Getty Petroleum in 1997, and Lukoil took control of the gas-station operator in 2000. Getty Realty, however, continued to own the underlying land on which the gas stations operated after the split.
Getty Petroleum filed for Chapter 11 in December 2011, less than a year after being purchased by Cambridge Securities. The company's bankruptcy filing followed a $234 million arbitration decision stemming from a fight with ethanol company Bionol, which itself was liquidated in bankruptcy.
Dow Jones Newswires