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CHERYL GLASER: One of the biggest initial public offerings ever makes its debut today. The Russian government is selling about 12 percent in the giant state-owned oil company Rosneft. The shares are listed not on Wall Street, but in London and the deal's expected to raise as much as $10 billion. But it's also sparked some real debate among financial types about investing in a company run by the Kremlin. From the Marketplace European desk, Stephen Beard reports.

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STEPHEN BEARD: On the face of it these shares look pretty tempting, in fact a real steal, says Nick Redman of the Economist Intelligence Unit.

NICK REDMAN: Rosneft is a company with friends in the highest places and therefore would appear to have a very bright future:

He says Rosneft seems very well placed to profit from Russia's gigantic oil reserves.

REDMAN: As a state-owned company in an oil sector which is large by global standards the feeling is that Rosneft is going to have the pick of state licenses in the future.

Yes, a steal. But that according to the critics is the problem. They say that Rosneft's most valuable asset, its main oil production unit, was indeed stolen.

ROBERT AMSTERDAM: It's state theft in an attempt to be legitimized. These are stolen goods.

Toronto-based lawyer Robert Amsterdam represents the stricken Russian oil company YUKOS.

That company was broken up on the orders of President Putin, allegedly because the boss was a political opponent. The Kremlin compelled YUKOS to sell its biggest asset on the cheap to state-owned Rosneft. Amsterdam says the Rosneft IPO is an affront to the rule of law.

AMSTERDAM: These are stolen goods. And they will be stolen tomorrow and the day after tomorrow until the people who own YUKOS have been properly compensated for the theft. And no number of IPOs will change the fact that Russia has engaged in state theft.

The Rosneft IPO, says Nick Redman, is partly an attempt to buy off such criticism.

REDMAN: If you can get western investors involved in the company, they can have a stake in it, then there's less reason to complain about the YUKOS affair.

And, says Chris Skrebowski of Petroleum Review, this could bolster Putin's brand of Kremlin-controlled capitalism.

CHRIS SKREBOWSKI: It would set the precedent that Russia makes the rules….and western investors still turn up to part with their money.

The three biggest investors in Rosneft so far are oil companies. One of them, the British giant BP. Nick Redman says they are obviously trying to curry favor with the Kremlin.

It's a way of getting on good terms with the state. And what is clear following the YUKOS affair. is that if you're not on good terms with the Russian State you're not going to get anywhere in Russia's oil sector.

YUKOS also showed the dangers of investing in the Russian oil industry. But all doubts and scruples seem to have been swept aside. The Rosneft IPO has succeeded. The ever-rising price of oil has ensured that President Putin has got his way.

In London, this is Stephen Beard for Marketplace.