MegaFon sells stake in mobile phone retailer Svyaznoy
MOSCOW. Dec 5 (Interfax) - MegaFon has sold its stake in mobile phone retailer Svyaznoy, the Russian mobile service provider's CEO, Khachatur Pombukhchan said in an interview with RBC.
"All that I can say is that we're no longer shareholders of Svyaznoy, and our decision is in no way related to the operations and efficiency of Svyaznoy itself," Pombukhchan said, adding that the company is pleased with the deal. However, he did not name the price or the buyer or provide other details.
He said that in recent years MegaFon has made great strides in the development of its own retail chain, which fully covers its needs.
The decision was also due to the fact that Svyaznoy has no relation to the telecommunications market, but focusing on this company "takes up the time and efforts of the team and is useless," Pombukhchan said. However, MegaFon has retained commercial and partnership contracts with the retailer, he added.
MegaFon acquired a stake of 25% plus one share in Svyaznoy in 2018, along with two seats on the board of directors, as a result of the retailer's merger with the Euroset retail chain, sole ownership of which the provider consolidated several months earlier.
Svyaznoy has more than 2,600 stores in 1,100 cities in Russia, the company's website said. Cyprus-based DTSretail Ltd owns 69.25% of Svyaznoy and Netherlands-based Euroset Holding N.V. owns 24.8%, according to the SPARK service. The retailer owns 50% of Svyaznoy Service, a network of authorized service centers. Svyaznoy closed 2021 with a net profit of 15.2 million rubles on revenue of 105.4 billion rubles.
After the start of the military operation in Ukraine, a number of equipment vendors stopped shipping to Russia. By July 2022, Svyaznoy had received 14.2 billion rubles in legal claims for failure to meet obligations on various contracts in lawsuits filed by Sovcombank, Alfa Bank, distributor Merlion, and Beeline mobile service provider Vimpelcom, among others, RBC recalled.
On December 1, the Moscow Arbitration Court approved a settlement between Svyaznoy and Sovcombank, which had demanded 2.9 billion rubles from the retailer. Under the ruling, Svyaznoy is supposed to pay the bank about 2.6 billion rubles in several instalments by the end of 2025.
The retailer must also not change its ownership structure without the bank's consent, not pay dividends, not provide loans or guarantees exceeding 200 million rubles per year, not reduce charter capital, not carry out transactions to divest assets worth more than 5% of total assets, with the exception of transactions carried out in the usual course of business selling goods.