By Tom Miles
GENEVA (Reuters) - The United States added Russian billionaire Gennady Timchenko to its sanctions list on Thursday, forcing him to sell his near 50 percent stake in the vast oil trading empire he co-founded in order to keep it running.
Hours after Washington slapped sanctions on 20 of Russian President Vladimir Putin's closest long-time political and business allies, Swiss-based trading firm Gunvor announced that Timchenko had sold his stake in the firm to Chief Executive Officer Torbjorn Tornqvist earlier this week in order to "ensure with certainty the continued and uninterrupted operations" of Gunvor.
It said Tornqvist had become the majority owner with 87 percent, the remainder held by senior employees.
Timchenko, who co-founded Gunvor in 1997, was among several Russian businessmen placed under sanctions by the United States on Thursday, as Washington threatened to drag the huge and far-reaching business interests of some of Putin's inner circle into the standoff between Russia and Ukraine.
President Barack Obama threatened broad penalties against key sectors of Russia's economy if Moscow moves deeper into Ukraine.
Also on the list were brothers Boris and Arkady Rotenberg. Arkady, the elder brother, is a long-time judo sparring partner of Russian President Vladimir Putin and owns Stroygazmontazh, a builder of oil and gas pipeline projects for Russian state and private energy companies.
"Putin has investments in Gunvor and may have access to Gunvor funds," the U.S. Treasury said as it added Timchenko to its list of "Specially Designated Nationals." People on the list have their assets blocked and U.S. persons are generally prohibited from dealing with them. (Treasury announcement: http://r.reuters.com/baq77v)
Gunvor said in a statement it was outraged by the U.S. Treasury's linkage of Putin and Gunvor.
"President Putin has not and never has had any ownership, beneficial or otherwise in Gunvor. He is not a beneficiary of Gunvor or its activities. Any understanding otherwise is fundamentally misinformed and outrageous," the company said.
As Gunvor sought to reassure its trading partners that Timchenko's shareholding had been severed, U.S. officials also said the company itself did not seem to be at risk.
The U.S. Treasury said it advised caution when considering transactions with a company that may be controlled by a sanctioned person, but it added that Timchenko's stake was below the 50 percent threshold that would automatically trigger sanctions on Gunvor.
REVENUE OF $93 BLN
Timchenko is a non-executive director of Russian gas company Novatek and was awarded the French Legion d'Honneur last year.
Gunvor had revenue of $93 billion in 2012, according to a factsheet on its website, earning $433 million. It traded around 2.5 million barrels of oil a day, the factsheet showed, the equivalent of almost 3 percent of global supplies.
The company has more than 60 global banking partners, the factsheet said, and sources crude oil from 35 countries. Gunvor employed more than 1,600 people in 2012.
Tornqvist told Reuters in November that the company was studying growing opportunities in North America resulting from the shale oil boom, including exporting liquid petroleum gas, and looking at select trading assets.
Gunvor owns a $400 million stake in the Signal Peak coal mine in Montana that it bought in 2011.
Arkady Rotenberg has a stake in Russia's largest bridge builder Mostotrest through investment vehicle Marco Polo Investments, where he is a main shareholder. Both his firms were involved in construction work for the Sochi winter Olympic Games held last month.
(Additional reporting by David Sheppard in London and Edward McAllister in New York; Editing by Jonathan Leff and Lisa Shumaker)