Moscow press review for July 25, 2011
MOSCOW. July 25 (Interfax) - The following is a digest of Moscow newspapers published on July 25. Interfax does not accept liability for information in these stories.
VEDOMOSTI:
Mechel is again preparing its Mechel-Mining subsidiary for the IPO. It expects to raise $1.5 billion to $2 billion from the sale of 10-15% of Mechel-Mining shares; Bloomberg reported quoting its own sources. Thus the subsidiary as a whole costs $10 billion to $20 billion. The company plans to place securities based on such an estimate, a source close to Mechel confirmed. It told Vedomosti that the IPO may be conducted as early as autumn in London or Hong Kong. An official Mechel representative refrained from making any comments. ("Coal for $20 Bln")
Norilsk Nickel has announced contracts on the sale of approximately 8% of quasi-treasury shares of Dutch Trafigura on December 20, 2010, but did not disclose any details. The securities were sold in two installments, three sources close to the company and its shareholders told Vedomosti. On October 12, 2010 Norilsk Nickel signed an option for the sale of 3.6% of shares at $18.1 apiece ($1.2 billion for the package). The option was used and the company even received a premium of $67 million, Vedomosti sources said. Agreements for the sale of 4.45% for $18 apiece ($1.5 billion) were concluded in October-December and used at the same time. The deal closed last year brought the company $2.7 billion. Presently the shares could have brought 50% more. ("Mystery of Trafigura")
Russia's successful development is impossible without the curtailment of the state-owned sector, government experts have decided. They suggest that state corporations and banks stop buying assets and drop management by command and control. The proposal to fundamentally reform the public sector is made in an intermediate report of the expert group "The Management of State Property and Privatization" which will become a composite part of a summarized report with tentative proposals from experts on Russia's development strategy until 2010 which the Cabinet will discuss in August. The final proposals will be submitted by the end of the year. ("Time to Go Out")
Russian Technologies want to deliver not only 50 Boeing 737 Next Generation aircraft to Aeroflot but also the same amount of Russian MS-21 airliners that are still being designed. Russian Technologies and Aeroflot should agree on the parameters of the future deal by the end of the month, a source close to Aeroflot told Vedomosti. The sides remain to agree on the price. The carrier sent its proposals to Russian Technologies a long time ago. The market rates for airliners are $380,000 - 420,000 a month. Aeroflot counts on the minimal rate for the entire batch, a source close to the airlines said. Operational leasing is in question. ("A Hundred for Aeroflot")
This year the Russian telecommunication market saw a small revolution: the four greatest rivals - MTS , Vimpelcom , Megafon and state-owned Rostelecom - formed a consortium to find frequencies for the development of 4G cellular networks of the latest LTE standard. The supreme governing body of the consortium is led by Oleg Malis who for six previous years was the senior vice president of Altimo that manages the telecom assets of Alfa Group - 24.9% in Vimpelcom and 25.1% in Megafon. Malis believes that 4G communications may become operational in Russia already next year, though there will hardly be enough frequencies for more that four companies. ("We are untangling a Complex Set of Problems," - Oleg Malis, LTE Association Board Chair")
VTB Capital and News Corp have announced the completion of a deal in which a pool of investors led by the state-owned bank bought 79% in Russia's biggest outdoor advertising operator - News Outdoor Russia (NOR) - from the media corporation. In addition, to VTB Capital the pool includes Dutch NOOH Investments Cooperatief (representing the interests of CTC founder Peter Gerwe) and Marathon Outdoor Cooperatief U.A. (managed by Alfa Capital Partners), News Corp reports. The NOR management will keep its 21% stake in the company, News Corp says. Neither the seller, nor the buyers are disclosing the sum of the deal. Several sources in the companies, parties to the deal, are claiming that it is around $270 million. ("New Owners of News Outdoor," also in Kommersant p. 10 "News Outdoor changes Ownership")
KOMMERSANT
State-owned Zarubezhneft continues to curtail the geography of its business. Its JV with Vietnam's PetroVietnam is withdrawing from a project in Myanmar and one of the projects in Tunisia. This year Zarubezhneft already gave up the development of a section it owns in Cuba for lack of prospects. Meanwhile, extraction at the main asset of the company, Vietsovpetro, is declining but it has a chance of increasing extraction in Vietnam. (p. 9 "Zarubezhneft leaving Tunisia and Myanmar")
Italy's Edison that became the first European consumer to launch litigation with Gazprom over gas prices has succeeded in winning concessions from the monopoly. In itself they will not be burdensome for Gazprom as Edison buys no more than 2 bcm of Russian gas a year. However, the situation may complicate the monopoly's talks with other, biggest consumers. (p. 1 "Discount pumped out of Gazprom")
A month after the annual shareholder meeting Norilsk Nickel finally published its 2010 financial statements. Still they are incomplete as the auditor's report is missing. According to Kommersant, auditors are refusing to sign off the document because it contains almost no information on Norilsk Nickel deals. The problems with financial statements may aggravate the situation with Norilsk Nickel's credit rating the outlook of which is already negative. (p. 9 "Norilsk Nickel fails to persuade Auditors")
Kommersant has learned that the management of Sovcomflot suggests conducting the company IPO at NYSE. However, the organizer of the placement chosen by the state, Morgan Stanley, insists on LSE warning that the company is short of time for making the placement in New York this year. However, even for the placement in London the company should compile all due documents by mid-August. (p. 9 "Sovcomflot set on Course to New York")
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