Gonvor Profits Surge 2.3% Despite US Sanctions on Co-founder

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Gonvor Profits Surge 2.3% Despite US Sanctions on Co-founder

Energy firm Gunvor Group Ltd announced on Wednesday a slight gain in profits for 2013 and said business had returned to normalcy after one of its co-founders was put on a list of Russian targets for US sanctions last month.

The firm, which is registered in Cyprus, announced in a statement published on its website that net income climbed to $308 million in 2013, up from $301. Trading volumes sank to 131 million metric tons from 130 million.

Gennady Timchenko, a billionaire co-founder of Gunvor sold his interests in the fourth-largest oil trader in the world in March, one day before the US imposed economic sanctions on him and 19 others in reaction to Russia’s annexation of Crimea and tensions in Ukraine, according to Bloomberg.

“First-quarter results already indicate an improvement in underlying trading activity, though we acknowledge it will continue to be a challenging environment,” Gunvor’s cofounder and chief executive Torbjorn Tornqvist, said in a statement.

Tornqvist, who has been in charge of the firm since last month, said on March 28 that he may have to find another partner because the current ownership is too concentrated. At the moment, he controls about 87% stake in Gunvor after buying out Timchenko’s shares.

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While Gunvor was not in the list of entities targeted by the US sanctions over the situation in Ukraine, the US Treasury said that Russian President Vladimir Putin had interests in the firm and might even access its funds.

However, the company labeled the claims as “outrageous” and quickly acted to distance itself from Timchenko, saying that the current owner had acquired his stake before the sanctions were announced.

Gunvor told the Wall Street Journal in an interview on Wednesday that business was normal and no bank or counterparty had refused to do business with the company.

The company said it has nothing to do with the political events in Ukraine. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.

To contact the reporter of this story; Yashu Gola at yashu@forexminute.com