Sberbank could finance deal to buy Onexim out of Uralkali - sources
ST. PETERSBURG. June 17 (Interfax) - Sberbank could finance a deal by Uralkali shareholder UralChem or by Uralkali itself to buy Mikhail Prokhorov's Onexim Group out of the potash miner Uralkali, several banking sector sources told Interfax.
"Sberbank is prepared to finance a deal," one of the sources said, without going into detail.
VTB , another state owned bank capable of being involved in a deal of that magnitude, has not been approached for financing, another source said.
UralChem and Uralkali are not commenting on the information.
Onexim Group is holding negotiations with UralChem on the sale of its 20% stake in Uralkali, sources familiar with the situation told Interfax at the beginning of June. The details of the deal might emerge towards the end of the month, one source said, adding that the buyout of Onexim's stake by UralChem or affiliated entities was being discussed.
Banking sources told Interfax a year ago that UralChem wanted to raise a loan of $1.5 billion from state banks to buy out its partner's stake in Uralkali, but no agreement was reached at the time. Onexim did not get an offer for its Uralkali stake, a source close to Onexim said at the time.
There is no agreement on a deal yet this time either, and Prokhorov has not made a final decision on whether to sell, Bloomberg has quoted sources as saying. He expects to get about $4 billion for the stake, which is about what Onexim paid for the stake in 2013; it is known that UralChem paid $3.8 billion for a similar stake. However, Uralkali's share price has fallen by more than half since then - it is currently worth around $1.5 billion.
One of the options for a deal would see Uralkali itself buy out Onexim's stake, Bloomberg has reported.
Onexim and affiliates bought 27.09% of Uralkali in 2013. Onexim later sold some of that stake to Uralkali in a buyback, reducing its stake to 20%.
Uralkali has arranged two credit facilities for $3.9 billion with Sberbank that are available from the end of 2017. The potash miner intends to use the funds to refinance current debt.
UralChem owns 19.99% of Uralkali, 51% of the shares are quasi-treasury shares and the free float is 8.96%.