VLADIVOSTOK, Russia (Reuters) - Russia’s VTB Bank (VTBR.MM) expects to receive about 17% of Rostelecom (RTKM.MM) as part of a deal to sell its stake in Tele2 Russia to the state-controlled telecoms group, VTB Chief Executive Andrey Kostin said on Wednesday.
Rostelecom currently has a 45% stake in Tele2 Russia, the country’s fourth-largest mobile phone operator, with the remaining 55% owned by VTB and its partners.
Russian officials have said that Rostelecom could make part payment for the 55% stake in Tele2 Russia with its shares, while businesss daily Kommersant reported in July that Rostelecom could issue new shares as part of a cash and shares deal.
“The additional share issue will be partly acquired by VTB Bank,” Kostin told reporters on the sidelines of an economic forum in Vladivostok.
“As a result, the bank will become owner of about 17% of Rostelecom.”
Kostin said he expects the deal to be completed by the end of the year.
Rostelecom said it is in the process of securing regulatory approvals required to complete the deal.
Reporting by Gabrielle Tétrault-Farber, Vladimir Soldatkin and Nadezhda Tsydenova; Writing by Anna Rzhevkina; Editing by Maria Kiselyova and David Goodman