Saturday May 30, 02:33 PM
Russia's Svyazinvest plans IPO after reform - CEO
By Anastasia Teterevleva
BEKASOVO, Russia, May 30 (Reuters) - Russian state-controlled telecoms giant Svyazinvest may hold an initial public offering on Western bourses once its reorganisation is completed, its general director said on Saturday.
'Yes, flotation of shares on western stock exchanges is planned,' Yevgeny Yurchenko told reporters on the sidelines of the annual general meeting of Svyazinvest-controlled former long-distance monopoly Rostelecom.
The Russian government on Friday cleared the reorganisation of Svyazinvest under the umbrella of Rostelecom which is designed to increase the holding company's efficiency and reveal the fair value of its assets.
Senior officials have said Svyazinvest's reorganisation would enable the government to play a bigger role in the telecoms sector and will allow it to expand aggressively in Russia and abroad.
Yurchenko, who was appointed general director of Svyazinvest this year, also said it would be interested in buying fixed-line operator Comstar.
'Potentially yes, certainly, it would be interesting, but no offer has been made as of today,' Yurchenko said.
Business daily Vedomosti reported on Tuesday Svyazinvest was preparing to make the offer to Comstar shareholders, rivalling a potential bid by mobile carrier MTS.
The deal would fit in with the emerging strategy of Svyazinvest which said it would in particular want to have exposure to the Moscow telecoms market where Comstar, part of oil-to-telecoms group Sistema, plays a major role.
Yurchenko said the government was considering various options for a merger between Rostelecom and regional operators including some that did not necessarily foresee early debt repayment by Svyazinvest subsidiaries.
Yurchenko said the final reorganisation scheme for Svyazinvest would be approved in the summer and that the IPO, if held, would not take place on the New York Stock Exchange.
A source close to Rostelecom's shareholders said Rostelecom could delist from NYSE as part of the reorganisation.
The government has 75 percent minus one share in Svyazinvest, after selling a one-quarter stake to a George Soros-led consortium in 1997.
The stake changed hands and was eventually sold to Comstar, which is now negotiating swapping it for the Svyazinvest stake in Moscow incumbent MGTS and forgiveness of Comstar's debt provided by state lender Sberbank.
(Writing by Maria Kiselyova, editing by Mike Peacock) Keywords: SVYAZINVEST IPO/
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