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company’s controlling shareholder Boris Mints's O1 Group, defaulted on a RUB5bn bond, unable to pay the fourth coupon worth RUB125mn, and previously failed to carry out the mandatory buyout offer for the same bonds. This made the third default on five bond issues by O1 worth a total of RUB87bn ($1.37bn). One of them is the $350mn Eurobonds maturing in 2021 were issued by O1 Properties, one of the largest owners of office spaces in Moscow, in 2016 and yield 8.25%. Since April the bond price dropped by 17pp to bonds trade at 63.5%, with the yield increasing by 10pp to 25.4%.
Saudi Arabian Public Investment Fund (SAPIF) will invest $100mn into the construction of Moscow techno-park Tushino, as well in the Professional Logistics Technologies (PLT) platform, which is Russia's fifth largest logistics operator, the state controlled investment vehicle, the Russian Direct Investment Fund (RDIF) announced. The Tushino investment will be carried out within a consortium formed by RDIF and the Russian-Chinese Investment Fund, with total project cost estimated at RUB90bn ($1.5bn). PLT was created by RDIF in 2016 jointly with Mubadala Development Company and other Middle Eastern funds, with SAPIF becoming one of the three main investors in the operator. Currently PLT operates four logistics parks in the Moscow region, Novosibirsk, and Yekaterinburg with a total area of 0.5mn square meters (sqm). According to RDIF, PLT intends to increase its facilities to 2mn-3mn sqm. The largest players on the Russian logistics and warehouse market are British Raven Russia and MLP, the latter being part of Mikhail Gutseriev’s Safmar Group. The two companies operate 1.8mn sqm of facilities. According to JLL data cited by RBC business portal, total supply of warehouses in Russia in 2017 stood at 28mn sqm, out of which 60% was in Moscow.
9.2.5 Retail corporate news
Safmar group of billionaire Mikhail Gutseriev confirms earlier reports and will acquire MediaMarktSaturn electronics retailer owned by the German Ceconomy , Vedomosti d aily said on June 20 citing both companies. MediaMarkt will be included in the mega-merger of M.Video and Eldorado electronics retailers , which combined two of Russia’s top companies to create an unrivalled national retail champion as big as any company in the rest of Europe Safmar will aslo sell a 15% stake in M.video to Ceconomy for $470mn, based on M.Video’s market capitalisation of $3.13bn, sources told Vedomosti. VTB Capital notes that this is the combined value of M.video+Eldorado+MediaMarkt post-merger, as the standalone M.video capitalisation is $1.2bn). The deal value for Safmar is reportedly made up of economic control of Media Markt’s entire Russian business, valued at $170mn, plus $300mn in cash. The deal is to be closed by September 2018, after which M.video is to buy the MediaMarkt business from Safmar, possibly attracting debt financing. The deal is still subject to Federal Antimonopoly Service (FAS) approval. Currently the total market share of M.video, Eldorado and MediaMarkt in Russia would be 29%, with MediaMarkt accounting for 3% of the total. VTB Capital reminds that market shares above 35% "typically catch FAS's attention." VTB is "positive on the transaction, subject to the company's ability to successfully integrate the acquired business under the combined umbrella (presumably the MediaMarkt brand will be phased out) and remove
RUSSIA Country Report July 2018 www.intellinews.com