State-controlled Rostelecom, Russia’s fifth largest operator, may be in line to take a stake in Tele2’s Russian operations, now owned by VTB bank, according to Vedomosti.
According to the report, St Petersburg-based Bank Rossiya might buy a 30 per cent stake in the Tele2 Russia business as a first step to selling the company to Rostelecom.
State-controlled bank VTB bought Tele2’s Russian business in April in a deal worth $3.55 billion, fending off a joint bid from MTS and Vimpelcom – number one and three respectively in the Russian mobile market – and a rival offer from A1, the investment arm of Russia’s Alfa Group.
Vedomosti, citing unnamed sources, said Bank Rossiya had agreed to buy 30 per cent of Tele2 Russia, but would probably act as an intermediary for Rostelecom rather than be the final purchaser of the asset.
According to Reuters, VTB said last week that talks to sell a stake in Tele2 Russia were at an “advanced stage” with a number of private investors.
Bank Rossiya and VTB declined to comment in the Vedomosti report.
Reuters points out that expectations of a merger between Tele2 Russia and Rostelecom increased last month when Alexander Provotorov, a former Rostelecom CEO, who had backed the idea of a merger between the the two companies, was appointed to run the Tele2 Russia business.
The Nordic operator has the right to a share of half the net cash profits obtained by VTB if it sells any Tele2 Russia’s shares or assets during the 12 months after the transaction was closed in April.