Page 7 - Demo

The Regions This Week
June 30, 2017 www.intellinews.com I Page 7
Eastern Europe
Russia is signing new wheat export contracts with Turkey without any price premiums after the resolution of a trade dispute between the two countries. Turkey is the second-largest buyer of Russian wheat after Egypt and the biggest buyer of its sunflower oil.
Since June 13, the ruble exchange rate has de- preciated from RUB57.0 per dollar to RUB59.6 as of June 26, or by 4.4%, including a sharp drop in the first two days of the week. The main reason for the drop is the exit of foreign investors from the local debt market amid concerns over a new escalation in tensions between Russia and the US.
The Russian Finance Ministry placed 10- and 30-year sovereign Eurobonds on June 26 for a total amount of $3bn ($1bn in 10-year paper and $2bn of 30-year bonds). According to the offering memorandum, the estimated yield was 4.25% on the 10-year paper and 5.25% on the 30-year Eu- robond. The placement organiser VTB Capital said demand for the two tranches exceeded $6.6bn.
The Ukrainian government approved a UAH38.5bn (€1.29bn) capital injection for PrivatBank, split into two tranches of UAH22.5bn and UAH16bn. The first UAH22.5bn tranche is intended to cover losses from alleged fraudulent transactions carried out by the bank’s prior management. The remaining UAH- 16bn relates to property portfolio impairments.
US investors reportedly bought $900mn of $1.4bn dual-tranche US dollar-denominated Eu- robonds placed by Belarus on June 22. Investors from the UK bought 26% ($365mn) of Eurobonds with five-year and ten-year maturities, and in- vestors from continental Europe bought 9%, or $125mn, banking sources told Interfax.
Donald Trump's former presidential campaign manager Paul Manafort retroactively filed forms showing that his firm received $17.1mn in 2012-2014 from Ukraine's Party of Regions, previously headed by ex-president Viktor Yanukovych, the Washington Post
reported. Manafort has repeatedly rejected any wrong- doing during his work in Ukraine. Ukrainian authorities had previously looked into possible millions in off- the-book payments to the consultant.
Russia’s PIK Group board approved a dividend policy and plans to start distributing at least 30% of its operating cash flow as dividends, which will be paid twice a year starting from 2017 (the first dividends will be paid in 2018). Bankers were excited, as this makes PIK the first of the listed developers to base its dividend policy on cash flow rather than the size of net income.
Russian billionaire Mikhail Fridman’s L1 Retail agreed to buy Holland & Barrett, one of the larg- est health foods retailers in Europe, in a £1.8bn deal. The chain has more than half of its 1,150 stores in the UK as well as a substantial pres- ence in China, India, the Netherlands and UAE. L1 bought the company from its private equity own- ers Carlyle Group. It is the first acquisition by L1 Retail, which was launched late last year by Frid- man’s holding company LetterOne.
Russian airlines passenger traffic increased 26.3% in May. According to data from the Federal Aviation Agency (FAVT), Russian airlines carried 36mn passengers in 5M17 (+22.1%), including 8.7mn passengers in May (+26.3%).
A Russian court froze conglomerate Sistema's 31.7% stake in mobile phone company MTS, 100% of health company Medsi, and 90.5% of Bashkirian Power Grid Company as part of a €2.5bn damages case brought by state-owned oil major Rosneft. The restrictive measures limit Sis- tema's rights to receive any income on the arrest- ed assets. Sistema will appeal the court decision.
Russia's largest gold miner Polyus Gold held its SPO on Moscow Exchange at $66.5 per ordinary share. Media reports said 10% of its shares worth $800mn were placed but that the deal was a hard sell with international investors.