Blavatnik confirms interest in upping Svyazinvest stake

5 Oct 2005

Russian-American entrepreneur Len Blavatnik has told Reuters that he sees his current 25% stake in Russian telecoms holding company Svyazinvest as a strategic investment and plans to take a majority stake in the company in its forthcoming IPO. A draft decree outlining the sale of the state’s remaining 75% minus one share has been passed to the Kremlin and is expected to be ratified in the first half of next year. The state predicts that the IPO could raise between USD2.5 billion and USD4 billion. ‘We will take part in the auction for Svyazinvest if terms are reasonable,’ Blavatnik told Reuters in London late on Monday. Blavatnik’s Access Industries bought its stake for USD650 million from Cyprus-registered investment company Mustcom in April 2004. ‘It’s definitely a strategic investment – it’s too much money for it not to be strategic,’ he added.

Svyazinvest holds controlling stakes in all seven ‘mega-regional’ operators: Center Telecom, NorthWest Telecom, Volga Telecom, Southern Telecom, Uralsvyazinform, Siberia Telecom (Sibirtelecom) and Far East Telecom (Dalnevostochnaya). It also has stakes in Moscow Local Telephone Network (MGTS) and the country’s national long-distance and international monopoly operator Rostelecom.

Russia, Svyazinvest