Bitumina, a bitumen binder and asphalt company based in Dubai, U.A.E., bought Neste’s 49.99% share in Nynas. The two other main shareholders are Petroleos de Venezuela S.A., which has 15%, and a foundation registered in the Netherlands called Nynasstiftelsen, which has a 35% stake that was previously held by PdVSA.

The reorganization is intended to ease the company’s financial difficulties. Sanctions imposed by the United States on Venezuela and therefore PdVSA, its former majority shareholder and supplier of naphthenic crude feedstock, forced Nynas to buy pricier crude and closed it off from lines of credit.

Neste did not go into detail as to why it initiated the sell-off, but the company’s chief financial officer, Jyrki Maki-Kala, commented in a press release that, “We believe that the sale of Neste’s shares in Nynas to an industrial player with a strong focus in the same sector is the right solution for Nynas, recognizing also the ongoing reorganization process.”

The extension granted by Sodertorn’s District Court gives Nynas until Dec. 15 to complete the reorganization. The company sought protection from creditors in December 2019 after banks refused to extend its loans. Officials said at that time Nynas and its shareholders had a plan to return the company to profitability, but that it needed relief from loan payments that were due and which it was unable to pay.

The ownership change announced recently is an important step in the reorganization. Nynas is still in discussions with its main creditors about restructuring debt.

In light of the change in ownership, Nynas and the administrators expect to complete the reorganization within three months.

Neste has tried to offload its 49.99% equity holding in Nynas since 2012, with no takers until Bitumina recently came along, according to Stephen B. Ames, of SBA Consulting in Pepperpike, Ohio. “Similarly in 2012 PdVSA, the then majority partner, had also sought to disband the partnership, claiming Nynas undervalued PdVSA’s crude oil used to feed Nynas’ naphthenic and bitumen plants,” Ames told Lube Report.

Since that time, he noted, Neste gradually marked down its equity in Nynas from €201 million (U.S. $237 million) in 2016 to finally writing off the remaining €34 million carrying value as well as a €59 million loan in September 2019. Carrying value is a measure of value for a company’s assets. “Nynas had recorded losses in recent years,” Ames said, “hampered in part from having to skirt U.S. sanctions on Venezuela and from the loss of naphthenic base oil production from the PdVSA- operated Curacao refinery since 2017.”

He recounted that PdVSA owned 50.001% of the company’s shares until May when it sold 35% of shares to independent Swedish foundation Nynasstiftelsen to allow Nynas to escape U.S. sanctions that hobbled its ability to finance operations and purchases of crude oils.

In addition, he noted Nynas also held exclusive rights to the bitumen production from Neste’s Naantali refinery and for some process oils from Neste’s Porvoo refinery. “The bitumen offtake is apt to continue with Bitumina,” Ames said.

George Gill contributed to this article.