June 8, 2018 / 12:13 PM / a year ago

UPDATE 1-Russia-China fund, Middle East investors eye stake in Sovcombank

(Adds details, quotes, background)

BEIJING/MOSCOW, June 8 (Reuters) - Russia-China Investment Fund, established by Russian sovereign fund RDIF and China Investment Corp., said on Friday it planned to invest in Russian lender Sovcombank jointly with a consortium of leading Middle Eastern funds.

The term sheet, signed during President Vladimir Putin’s visit to Beijing, sets out plans for the consortium to acquire a minority stake in Sovcombank.

The investors are set to buy new shares and none of the existing shareholders plan to sell their holdings, Sergei Khotimsky, a shareholder and first deputy chief executive of the bank, told Reuters via the press office. He did not disclose the value of the deal or the size of the stake.

A source close to the deal told Reuters the funds planed to invest around $100 million in the bank.

Sovcombank in turn will invest in expanding its business in Russia and plans an initial public offering in the next three years, RDIF said in a statement.

Sovcombank, among Russia’s top 15 lenders by assets, is controlled by brothers Sergei and Dmitry Khotimsky, who own a combined 38 percent stake, according to the bank’s documents. (Reporting by Denis Pinchuk, Tatiana Voronova and Polina Nikolskaya; Writing by Katya Golubkova; Editing by Mark Potter)

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