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Sistema, Russia-China Investment Fund sell 15.94% of Detsky Mir for 11 bln rubles

Sistema and the Russia-China Investment Fund (RCIF) have sold 15.94% of Detsky Mir shares in an offering for almost 11 bln rubles ($158 mln), Russia’s diversified holding company said in a statement on Wednesday.

The sides offered around 118 mln shares of Detsky Mir, with the price of one share set at 93 rubles, which is equivalent to 3.9% discount. Following the completion of the offering, the share of Sistema in the retailer will decline to 20.38% (from 33.38%), the share of RCIF - to 4.62% (from 7.56%), while the remaining shares are in free float.

Sistema plans to use the funds raised from the offering, which is almost 9 bln rubles, for corporate purposes, particularly for discharge of liabilities. Financial liabilities of Sistema's corporate center amounted to 207.8 bln rubles ($3.02 bln) by the end of the first quarter of 2020. The strategic goal of Sistema is to reduce debt to 140-150 bln rubles ($2.04 - 2.18 bln).

Detsky Mir Group is a multi-format retailer, which comprises the Detsky Mir retail chain, ELC (Early Learning Centre in Russia) and the ABC retail chains, as well as the Zoozavr pet supplies retail chain. The total number of stores as of May 31, 2020 was 851.