US court clears Altana Fund to participate in auction of shares in Citgo parent

The decision paves the way for Altana to cash its about $530 million claim from proceeds in an auction of shares in PDV Holding, whose only asset is oil refiner Citgo.

A U.S. court on Wednesday ruled that holder of Venezuelan bonds Altana Credit Opportunities Fund could seek proceeds from a coming auction of shares in Citgo Petroleum's parent to pay the country's creditors. The decision paves the way for Altana to cash its about $530 million claim from proceeds in an auction of shares in PDV Holding, whose only asset is oil refiner Citgo. The auction could conclude later this year, U.S. Judge Leonard Stark ruled.

Stark separately denied a writ of attachment to Florida resident and creditor Ricardo Devengoechea, but will allow him additional time to further argue why his $17 million claim should be attached to the case. The judge said he would slightly modify the auction procedure, but he is trying to "draw a line" on allowing other creditors to join the case. He said state oil company PDVSA remains the alter ego of Venezuela.