LONDON - Former BP boss Tony Hayward has returned to the oil business with an agreement to acquire Turkish explorer Genel Energy to create a Kurdistan-focused group worth $4 billion.

Vallares , an investment vehicle set up by Hayward, financier Nat Rothschild and banker Julian Metherell, is courting uncertainty over payment for Genel's oil, and corporate governance concerns with the deal.

The enlarged group will be known as Genel Energy Plc and Genel's existing shareholders will own half the enlarged group, Vallares said on Wednesday. Reuters reported news of the deal on Tuesday.

The transaction, which will see Vallares issue new shares worth $2.1 billion at 1,000 pence apiece, will likely increase concerns about the practice of using reverse takeovers to give fast-track London listings to emerging market groups.

In June, Vallares raised 1.35 billion pounds ($2.2 billion) from investors to target emerging-market oil assets. The plan was to offer oilfield owners a shortcut to a London Stock Exchange listing, enabling them to raise finance to fund the development of their assets.

Hayward, who said at the time he would be CEO of any acquired company, has assembled a team of big names, including Rodney Chase, a former BP deputy CEO and chairman of Petrofac.

Hayward, Rothschild and the other Vallares founders, are entitled to a 6.67 percent stake in the enlarged group, following the completion of any deal.

Genel previously tried to come to the London Stock Exchange, via a merger with Heritage Oil but the deal foundered amid an insider dealing probe against Genel chief executive CEO, Mehmet Sepil, which ended with him receiving a record fine.

Vallares chairman Rodney Chase said: "Genel Energy Plc will have a majority of independent directors and is expected to be fully compliant with UK corporate governance rules".

Iraq has challenged the legality of deals signed between the semi-autonomous Kurdish Regional Government and companies such as Genel and has so far refused to pay companies fully for oil exported from the region via Iraqi pipelines.