Telia has sold the remaining 19% stake it held in Russia’s MegaFon to Gaprombank for R60.4 billion (€890.5 million).
Commenting on the transaction, Johan Dennelind, Telia’s president and CEO, said: “Telia Company is one of the founders of MegaFon and we have since the inception actively contributed to its success of becoming a mobile and digital leader in Russia. After recently commencing our exit from MegaFon by placing 6.2% of our holding on the open stock market, this divestment now puts an end to Telia Company’s ownership in MegaFon in accordance with our strategy to focus on the Nordics and Baltics”.
Telia notes that Gazprombank has agreed to a lock-up of six months from the date of the sale, subject to certain exceptions. It adds that it has conducted due diligence and background checks of the party in the transaction.
Significantly, Telia also says that the transaction does not violate the sanctions imposed on Russia by the US and EU.
“Gazprombank is the third largest bank in Russia and is funding the acquisition with cash in immediately available funds and there is no funding or credit commitments from Telia Company or any other party. The European Union and the US have placed several Russian banks, among them Gazprombank, under sectorial sanctions. Gazprombank is subject to EU capital market sanctions and to Russia US Directive 1 Sanctions. The sanctions are prohibiting US and EU companies from financing, directly or indirectly, entities that are subject to the sanctions. This transaction does not involve any financing of Gazprombank or any trade in stock or other securities issued by Gazprombank and the sanctions are therefore not applicable”.
Prior to the current transaction, Telia disposed of a 6.2% stake in MegaFon last month on the open market at a price of R585 per share.
