Sberbank to decide on fate of Troika Dialog brand by year's end - Donskikh
MOSCOW. March 14 (Interfax) - Sberbank will likely hold onto the Troika Dialog brand but a final decision will be made in this regard by the end of this year, Sberbank's deputy chairman Andrei Donskikh said on Echo Moscow and Interfax's joint radio program SKANer.
"I think that a decision [on the Troika brand] will be made by year's end. It is entirely possible that we will hold onto the name Troika Dialog," he said.
Donskikh added that Troika Dialog is a stable brand that has been in existence for 20 years. "A quick decision to rename the company Sberbank would probably be rash," he said.
He said that Sberbank plans so far to continue with Troika Dialog's current product line. "Troika earns a substantial portion of its revenue from broker operations. Hence, there are no real grounds for changing, closing down or destroying this," Donskikh said, adding that there is no doubt that the company's entire product line would be retained.
Sberbank earlier signed an agreement on its intentions to acquire 100% of the shares in Troika this year. The transaction would be carried out in two stages. The first stage sees the sale of South African Standard Bank's stake in Troika (36.4%) sold this year, as well as the stakes held by Troika's partners and founders, which comes to 63.6%. The entire transaction would come to $1 billion.
The second stage foresees additional payments to the Troika partners and Standards, so-called earn-out transactions. These will be transferred on if the investment company posts high financial results for 2011-2013.
The maximum additional earn-out from Sberbank could come to around $700 million if Troika's average weighted profit for 2011-2013 is around $200 million. However, if the investment firm's average annual net profit is below $70 over the three-year period Sberbank will not need to make an earn out payment.