11 Mar 2010 10:44

RZD could sell TransTelecom stake in IPO, private subscription

MOSCOW. March 11 (Interfax) - Russian Railways (RZD) has sent proposals to investment banks regarding the sale of shares in its wholly owned TransTelecom in an IPO or by private subscription, the Kommersant newspaper said, quoting unspecified sources.

The paper did not say how much of the company might be sold or how much RZD planned to raise with the sale.

TransTelecom has figured on a list of companies in which RZD could sell stakes in order to finance its investments.

RZD chief Vladimir Yakunin said at the end of February that the company had asked the Russian Federal Property Agency to look at plans to sell shares in up to 30 subsidiaries in 2010-2012.

Russian Prime Minister Vladimir Putin at the end of February publicly backed plans to fund RZD's investments with share sale in the rail monopoly's subsidiaries.

One of Kommersant's sources said TransTelecom might be sold to a strategic investor. The Sistema holding expressed an interest in TransTelecom less than a month ago and the parties held consultations with the RZD-owned KIT Finance investment bank, but no decisions were reached, the paper said.

CJSC TransTelecom provides services to the corporate sector and households besides RZD itself. It has more than 53,000 kilometers of fiber-optic line with speed of up to 190 Gbit/second. Total sales revenue was 11.8 billion rubles, including 9.98 billion rubles from communications, in H1 2009.