Citgo Petroleum Auction: A Complex Legal Battle Over Venezuela's Largest Foreign Asset

A U.S. federal judge is overseeing a contentious auction involving Venezuela's Citgo Petroleum amidst legal challenges from creditors. The auction, totaling $3.7 billion, aims to repay 18 creditors impacted by Venezuela's expropriations, with ongoing disputes over Citgo's valuation and the recommended minimum bid.

A U.S. federal judge is pushing forward with the auction of shares in the parent company of Venezuela-owned Citgo Petroleum, amid new legal disputes among creditors. At issue is the recommended starting bid, which some creditors have deemed too low.

This complex auction process, aiming to address debts and expropriation claims totaling $21 billion against Venezuela and its state oil company PDVSA, was restarted in January. Prior bids fell through due to disagreements over Citgo's worth and related legal battles. Venezuela's legal representatives have raised objections regarding the auction and the handling of their prized overseas asset.

The court set a base bid of $3.7 billion for shares in PDV Holding, Citgo's parent company, after creditors rejected a $7.3 billion offer last year. A 'stalking horse' bid, recommended by a court officer, is now being contested. A decision on the bid is expected after April 4 as legal maneuvers and objections continue to unfold.

(With inputs from agencies.)