Published: October 11, 2013
Pair invests US$237.1mn in Russia’s largest telecoms company.
The Russian Direct Investment Fund (RDIF), a state private-equity vehicle, and Deutsche Bank have invested US$237.1mn in Rostelecom, Russia’s largest telecommunications company. The funds will be invested on a parity basis, and will be used to “further develop and strengthen the company’s market position”, according to an RDIF statement on the deal.
Under the terms of the transaction the two investors will purchase 72,187,366 of Rostelecom’s ordinary shares from subsidiary MOBITEL. Rostelecom is entitled to a portion of the profits from an increase in share value while investors will receive protection against a value decrease.
Rostelecom’s president Sergey Kalugin said of the deal: "We are confident in the potential of our company, so it was important for us to retain the right to benefit from upside deriving from an increase in the share price. On the other hand, we are committed to improving Rostelecom’s investor base and attracting high-profile investors. We have therefore decided to offer treasury shares to help achieve this outcome.”