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RCIF, Sistema to sell 15.94% in Detsky Mir at 93 rbl per share

MOSCOW, Jun 17 (PRIME) -- Multi-industry holding Sistema and the Russia–China Investment Fund (RCIF) will sell 117,777,459 shares in children goods retailer Detsky Mir, or a 15.94% stake, for 93 rubles per share, the Russian Direct Investment Fund (RDIF) said in a statement on Wednesday.

“The offer stands at 117,777,459 existing shares of Detsky Mir, which corresponds to 15.94% of the shareholder equity of Detsky Mir. The price of a Detsky Mir share under the offer was set at 93 rubles. … As a result of the offer, the selling shareholders will receive about 10.953 billion rubles, including the RCIF that will receive 2.023 billion rubles,” the statement read.

Sistema said quoting President Vladimir Chirakhov as saying that the price means a discount of 3.9% to Tuesday’s closing on the Moscow Exchange, one of the lowest in history for similar deals for Russian companies, especially among the companies with medium or low capitalization.

The RDIF said quoting Kirill Dmitriev, CEO of the fund and co-director of the RCIF, saying that demand of foreign and Russian investors for the stake exceeded the offer by 400%.

“More than 60% of the book was signed by the leading international funds from Europe, America, and Asia. We see great interest and opportunities for Russian companies to float and raise capital from the leading international investors in spite on the global negative consequences of the pandemic,” Dmitriev said as quoted by the RDIF.

Chirakhov that the company planned to use the money for general corporate purposes, including debt repayment. “Sistema remains a large Detsky Mir shareholder, and will continue to support its strategic development aimed at strengthening of market leadership, development of online sales channels, and expansion of the geography of presence,” Chirakhov said as quoted by the company.

On Tuesday, the RCIF said it will sell about 118 million shares in Detsky Mir through accelerated bookbuilding.

Before the sale, Sistema’s stake in Detsky Mir amounted to 33.38%, while the RCIF owned 7.56%. After the deal, the RCIF’s stake will fall to 4.62%, and Sistema’s to 20.38%, with their combined stake amounting to 25% plus one share. Free-float will amount to about 75%.