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Russia extends review of MegaFon's Euroset deal
MOSCOW Oct 24 (Reuters) - Russia's competition watchdog said it may take another two months to review mobile operator MegaFon's deal to acquire a stake in Euroset, the country's leading cellphone retailer.
The extension is not likely to further delay MegaFon's planned stock market listing in London and Moscow, which could raise up to $2 billion, three sources familiar with the situation said on Wednesday.
Anatoly Golomolzin, deputy head of the Federal Anti-Monopoly Service (FAS), had told reporters it needed more time to assess all circumstances of the proposed MegaFon-Euroset transaction. "It will take a maximum of two months or even less," he said.
MegaFon declined to comment. Its planned initial public offering could be the biggest by a Russian company since internet group Yandex last year.
It had been expected to begin marketing the IPO this week but said on Monday it decided to wait until after third-quarter results expected in early November.
One source said MegaFon's investor roadshow and subsequent IPO were expected mid-to-late November and the firm could, if necessary, say in its prospectus that the Euroset deal was awaiting regulatory approval.
The FAS had been expected to rule on the deal, which would see MegaFon eventually acquire half of Euroset for up to $1.33 billion, last week.
A source said the IPO was expected to be cleared by the UK Listing Authority in due course, adding U.S. investment bank Goldman Sachs's withdrawal as an underwriter was not expected to cause any problems.
MegaFon revealed the surprise absence of Goldman, which had been expected to be one of the lead banks, in the line-up of banks running the deal earlier this month, prompting questions from investors.
"The regulatory review took longer than we expected. Also with the M&A that was announced last week and the Q3 results coming out the view was taken to just do it after that," said another source close to the deal.
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