Disqualification Motions and Bid Controversy
The push to disqualify Pincus and his advisers centered on alleged ties to hedge fund Elliott Investment Management. Elliott’s affiliate, Amber Energy Inc., ultimately submitted the $5.892 billion bid that Pincus endorsed in his updated final recommendation.
Gold Reserve had initially secured Pincus’ backing with a $7.4 billion offer for the PDV Holding shares. But the special master later reversed course, concluding Elliott’s lower bid provided the best combination of price and closing certainty.
In November, Judge Stark approved the Amber bid, noting it would satisfy judgments owed to 10 creditors who had secured writs of attachment, extinguishing $5.892 billion in claims. The transaction would also wipe out $3 billion in additional debt incurred by Venezuela and PDVSA by largely resolving obligations to bondholders holding a 50.1% stake in Citgo Holding, a PDV Holding subsidiary.
Gold Reserve separately sought to disqualify Judge Stark himself for alleged bias. Stark rejected both disqualification motions in a 54-page opinion.
Venezuela and Gold Reserve have since appealed the Citgo sale order to the Third Circuit, where the matter remains pending.
