The recommendation to restart the auction came after an affiliate of Elliott Investment Management’s $7.3bn bid failed to gain creditor support. Credit: JHVEPhoto/Shutterstock.

The US District Court in Delaware is set to restart the auction of shares in Citgo Petroleum’s parent company, PDV Holding, reported Reuters.

With the move, the court aims to address $21.3bn in claims against Venezuela and its state oil company, Petróleos de Venezuela (PDVSA).

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PDV Holding is the US arm of PDVSA.

The auction process, which has been ongoing for a year, is being overhauled due to disarray, according to a court adviser.

The recommendation to restart the auction followed a court filing after an Elliott investment management affiliate’s bid of up to $7.3bn failed to gain creditor support.

Two groups have expressed interest in making offers if allowed to re-enter the bidding process.

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Robert Pincus, the court adviser, proposed restarting the auction after failing to reach an agreement that met previously agreed terms.

Amber Energy, a fully owned affiliate of Elliott, won the auction in September but did not close the deal.

It stated that the proposed terms would “create a chaotic atmosphere which will negatively impact the price of the purchase”.

A spokesperson for Amber Energy declined to comment on future steps.

The adviser’s plan to restart the sale largely aligned with Judge Leonard Stark’s approach to reviving the process.

Special Master Robert Pincus advised against Stark’s suggestion to proceed with cases involving the same assets, citing the likelihood that other bidders would not accept the risks of competing claims.

Pincus recommended reopening Citgo’s financial data to bidders, to formally relaunch the auction on 18 December and accept bids for three months.

He proposed that a final recommendation be made to the court in April 2025, with Judge Stark holding a hearing in late May next year to confirm the winner.