Sweden's Bonava to sell Russian business to Armenia's Star Development instead of RBI

ST. PETERSBURG. Oct 19 (Interfax) - Bonava has signed an agreement to sell its St. Petersburg operations to Armenian company Star Development LLC, the Swedish developer said in a press release.

The transaction amounts to about 50 million euros, which Bonava said it has already received. "On closure of the divestment, this transaction will generate positive earnings of approximately SEK550 million," the company said.

Star Development has received an acquisition permit from the special committee established to oversee business transfers, Bonava said.

"Closing of the divestment is subject to the approval of the Russian competition authority, which is expected in the fourth quarter of 2023," the company said.

Bonava announced at the end of May 2023 that it had reached an agreement to sell its Russian assets to RBI Group in a deal that could have totaled 3.3 billion rubles (equivalent to SEK440 million).

"Since RBI Group did not receive acquisition permit from the special committee established to oversee business transfers within the agreed timeframe, the contract has now been terminated," Bonava said on Wednesday.

Bonava announced in March 2022 that it would cease operations in Russia and in October 2022 the company said it planned to sell its subsidiaries in the country to Kazan-based developer G-Group for 98 million euros, but in December G-Group pulled out of the deal. At the time of signing the agreement with G-Group, Bonava had about 16 hectares of land in various parts of St. Petersburg.

Bonava, established in the spring of 2016 as a result of the spin-off of NCC's residential construction business, has operations in Sweden, Germany, Finland, Denmark, Norway, Estonia and Latvia. In Russia, Bonava had residential development projects in St. Petersburg and Leningrad Region.