Gold Reserve's unit bids for Citgo parent at court-led auction

Miner Gold Reserve announced on Thursday that Dalinar Energy, its subsidiary, had submitted a better bid in an auction organized by a court for the parent company Citgo Petroleum. A final decision is expected to be made next month.

A court officer who was overseeing the auction for PDV Holding - the parent company of Venezuelan owned U.S. refiner Citgo - said that a bid of $5,9 billion from an affiliate of Elliott Investment Management, the hedge fund, was the strongest to date. He gave Dalinar more time to prepare a response.

Gold Reserve stated in a press release that Dalinar had "substantially increased its proposed price, arranged additional financial support and increased the certainty" of its bid.

The Bermuda-based mining company, which is seeking to recover $1.18 billion in claims related to assets expropriated from auction proceeds, has not provided any further details.

Dalinar bid $7.4 billion in June for PDV Holding. However, its offer did not include an agreement with Citgo equity to pay bondholders of Venezuelan bonds that had defaulted.

Amber Energy, an affiliate of Elliott, secured a settlement agreement with bondholders for a $2.86-billion claim.

Amber's bid was disqualified this week by Gold Reserve, Siemens Energy, Consorcio Andino, and Valores Mundiales.

Delaware court officer Robert Pincus will likely submit his final recommendation for a winning bidder on Friday, ahead of the sale hearing next month where Judge Leonard Stark is scheduled to rule.

(source: Reuters)