Gold Reserve’s $7.1B CITGO Bid Rejected Despite Top Offer and Full Financing

Gold Reserve Ltd. (TSX.V: GRZ, OTCQX: GDRZF) announced that its U.S. subsidiary, Dalinar Energy Corporation, submitted a $7.1 billion fully financed bid to acquire PDV Holding Inc., the parent of CITGO Petroleum. Despite being the highest bid by over 91%, the U.S. District Court’s Special Master recommended a $3.699 billion offer from Contrarian Capital’s Red Tree Investments as the Stalking Horse Bid.

Gold Reserve disclosed full bid details via its website, highlighting backing from JPMorgan Chase and TD Bank for up to $6.5 billion in committed debt financing. Its offer included $3.2 billion in equity contributions from Koch Minerals, Koch Nitrogen, Rusoro Mining, and Gold Reserve, along with $3.9 billion allocated for senior creditors. Junior creditors could also participate via equity warrants.

The company expressed strong concern over the recommendation, noting that key documents supporting Contrarian’s bid were withheld from public disclosure. In response, Gold Reserve filed an emergency request for transparency, with a court hearing set for March 27, 2025.

CEO Paul Rivett criticized the decision, emphasizing that Dalinar’s bid offered full recovery for senior claimants and upside potential for junior creditors. Gold Reserve is currently exploring legal options and remains engaged in the ongoing Delaware sale proceedings.

The Delaware court process stems from the enforcement of arbitration awards related to the Venezuelan government’s asset seizures. Gold Reserve and others, including Crystallex and Koch entities, are among the judgment creditors.