US Investors Close to Buying Lukoil’s Foreign Assets, Sources Tell Reuters

The proposed deal would transfer Lukoil’s international assets to an investor consortium. In return, the consortium would surrender frozen Lukoil shares rather than pay cash. The structure matters because US sanctions restrict Lukoil’s ability to operate abroad and limit how sale proceeds can reach Russia.

Todd Boehly, a Miami-based investor with stakes in the Los Angeles Dodgers and Los Angeles Lakers, leads the group. Partners include Emirati firms International Holding Company and Al Hail Holding, the Al-Khayat brothers, and the US International Development Finance Corp. The consortium reportedly bought shares from roughly 10 American and British funds and US depositary banks at 30 cents per dollar.

Reuters reported that a deal could arrive within weeks, but it still requires approval from OFAC. The US Treasury authorized negotiations only until Nov. 21, 2026. If completed, the transaction would test whether sanctions can force a major Russian company to sell foreign assets without giving Moscow immediate financial gains.

When Lukoil shares were frozen, Western investment funds could no longer sell or trade them. The shares were also removed from major emerging-market stock indexes. Their holders therefore wrote down the shares’ value, turning a marketable investment into a restricted one.

Reuters reported that a bank acting for Boehly’s consortium bought the frozen shares from about 10 American and British funds and from US depositary banks holding shares for retail investors. The reported price was 30 cents on the dollar. Rather than pay Lukoil cash, the consortium would exchange those shares for Lukoil’s foreign assets.

This structure reflects US restrictions on Lukoil. The Treasury rejected a rival bid involving Xtellus Partners because Lukoil could not profit from a sale in cash or shares. Keeping the exchanged shares in escrow also helps prevent Lukoil from receiving immediate value. The deal still needs OFAC approval.

Lukoil’s foreign-asset portfolio was initially valued at about $22 billion. It covers multiple regions rather than one national market. That scale makes the proposed transaction important for Lukoil, investors and governments enforcing sanctions against Russia.

The portfolio spans Europe, the Middle East, Africa and Central Asia. Its businesses include overseas oil fields, refineries and gas stations. The article also notes that the value has fallen because some operations have shut down. The US Treasury allowed Lukoil gas stations outside Russia, including those in the United States, to keep operating until April 24, 2027.

The final value may therefore be lower than the original estimate. Any buyer would take on a portfolio affected by sanctions, operating closures and restrictions on payments to Russia. More than a dozen suitors reportedly competed, including Exxon Mobil and Chevron, before Carlyle withdrew and Boehly’s group moved ahead.

Escrow means the exchanged Lukoil shares would be held in a controlled account rather than handed directly to Lukoil. This matters because US sanctions require a sale to cut Lukoil’s ties to its foreign businesses and deny it any immediate financial gain.

The article says the Boehly group moved ahead by agreeing to keep the shares in escrow. That arrangement differs from giving the shares directly to Lukoil, which could provide the sanctioned company with an asset or financial benefit. The structure lets the consortium use the frozen shares as consideration for the foreign portfolio.

OFAC must review the final transaction. The Treasury has said proceeds owed to Lukoil must remain frozen, and a rival bid was rejected because Lukoil could not profit from the sale in cash or shares. Escrow therefore appears central to satisfying those conditions, although the article does not say who ultimately controls the account or when funds could be released.

OFAC stands for the US Treasury’s Office of Foreign Assets Control. It administers and enforces US economic sanctions, including restrictions involving sanctioned companies and payments. In this case, OFAC is the agency that must authorize the proposed Lukoil transaction.

The article says any sale must cut ties with Lukoil, deny it immediate financial gain and keep proceeds owed to the company frozen. Those conditions explain why a normal cash acquisition would not automatically be acceptable. The proposed escrow arrangement is designed to keep the exchanged shares away from Lukoil while the foreign assets change hands.

OFAC has authorized sale negotiations only until Nov. 21, 2026. The US Treasury also allowed Lukoil gas stations outside Russia to operate until April 24, 2027, while keeping a ban on sending funds to accounts in Russia. Without separate OFAC approval, the reported deal cannot proceed, even if the investors agree on terms.

If approved, the deal could transfer Lukoil’s international businesses to the Boehly-led consortium. Lukoil would lose foreign oil fields, refineries and gas stations, while the buyer would take control of assets across four regions. This would show sanctions forcing a major Russian company to sell abroad.

The key financial mechanism is restriction, not an ordinary payout. The consortium would exchange frozen shares, keep them in escrow and avoid paying Lukoil cash. US rules require proceeds owed to Lukoil to stay frozen and deny the company any immediate financial gain. That would limit money available to Moscow from the sale.

Foreign operations could continue under new ownership, but the portfolio’s value has already fallen because some operations shut down. The sale would also test whether sanctions can preserve important oil operations while limiting Russian benefit. Its completion depends on separate OFAC approval before the negotiation authorization expires.

Economic sanctions restrict how targeted companies own, sell, finance and operate assets. They can freeze shares, block payments to sanctioned accounts and prevent trading through financial institutions or markets. These measures raise the cost of doing business and can make investors unable to exit their holdings.

Lukoil illustrates the mechanism. Western funds could not sell or trade its shares, so the shares were removed from major indexes and written down. Sanctions also made Lukoil’s foreign businesses difficult to operate. The US barred funds from being sent to accounts in Russia, while requiring sale proceeds owed to Lukoil to remain frozen.

When a multinational cannot freely receive money, access investors or manage foreign operations, its overseas portfolio can lose value. That pressure can make selling assets the practical route. The proposed deal would transfer Lukoil’s foreign businesses while restricting its financial benefit, showing how ownership, payment and market controls work together. This explanation uses established sanctions principles alongside the article’s Lukoil examples.