By Marianna Parraga

HOUSTON (Reuters) -A $5.89 billion bid from an affiliate of hedge fund Elliott Investment Management has been recommended as the winner of a U.S. court-organized auction of shares in the parent of Venezuela-owned refiner Citgo Petroleum, according to documents filed late on Friday by the officer overseeing the sale process.

Improved bids emerged in the final stages of the auction, spurred by court rulings in parallel legal cases that encouraged revisions. Delaware Judge Leonard Stark is expected to make a final decision on the winner following a court hearing next month.

The recommendation from court officer Robert Pincus came despite a last-minute effort from a subsidiary of miner Gold Reserve earlier this week to sweeten its $7.4 billion offer, which had previously

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