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Two top investors in Russia's Lenta may sell some of their shares: sources
February 14, 2017 / 2:57 PM / in 9 months

Two top investors in Russia's Lenta may sell some of their shares: sources

MOSCOW (Reuters) - Two of Russian food retailer Lenta’s top shareholders may sell some of their holdings in the near future, banking sources told Reuters on Tuesday, capitalizing on early signs of economic recovery in Russia and higher oil prices.

People walk out of a Lenta supermarket in Moscow, February 3, 2014. REUTERS/Maxim Shemetov

Two sources said U.S. private equity fund TPG, which owns 34 percent of Lenta’s shares, was expected to sell a part of its stake. “TPG has indicated its intention to reduce its stake,” one said, adding a final decision would be made after investor meetings due later this week.

A third source did not rule out that the European Bank for Reconstruction and Development (EBRD) could also reduce its 7.37 percent stake in the company.

The sources said the sale could be carried out in a public offering co-ordinated by Lenta.

Lenta, EBRD and TPG declined to comment.

Lenta listed its shares in London in 2014, weeks before Russia annexed Crimea from Ukraine, and has sold shares twice since then.

It will hold an investor day in London on Feb. 16 after announcing its 2016 results earlier that day. It said in January its total sales grew 21 percent last year to 306.4 billion rubles ($5.4 billion).

Investors, both international and domestic, are making a cautious return to the Russian market, encouraged by early signs of a recovery in the domestic economy and a rebound in the price of crude oil. And some companies have already been taking advantage of a thaw in market conditions.

Owners of Russian toy seller Detsky Mir raised $355 million in an initial public offering last week, the highest-profile share sale by a Russian company since 2014, when Western sanctions over Moscow’s actions in Ukraine combined with a slump in oil prices to bring most deal-making to a standstill.

Shareholders of fertilizer producer Phosagro and aluminum giant Rusal have also sold shares on the market this month, while other Russian companies are considering tapping the equity market.

Lenta’s directors and management hold 1.1 percent of its shares with 57.7 percent being freely floated, according to Lenta’s website.

Additional reporting by Olga Sichkar and Maria Kiselyova; Editing by Jack Stubbs and David Holmes

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