USM Group raises MegaFon stake past 70%

3 Apr 2019

Russian mobile operator MegaFon’s controlling shareholder USM Group has upped its equity stake in the cellco to 70.32%, the company confirmed on its website. In the most recent transaction, USM Telecom purchased a 14.00% MegaFon stake from MegaFon Finance (a wholly-owned subsidiary of MegaFon itself) on 28 March 2019. USM Telecom is the sole shareholder of AF Telecom Holding which in turn holds a 56.32% interest in MegaFon. Both USM Telecom and AF Telecom are affiliated through common ownership with the USM Group (itself ultimately controlled by Russian business magnate Alisher Usmanov).

The latest intra-group deal upped the total interest of USM Group in MegaFon to 70.32% while reducing the position of MegaFon Finance from 42.88% to 28.88% of the company’s share capital. The percentage of ordinary shares and global depositary receipts in free float remains at 0.8% (pending an anticipated minority shareholder squeeze-out process). Note that earlier in March MegaFon (via MegaFon Finance) concluded a Mandatory Tender Offer purchasing 20.36% of minority shares (including Gazprombank’s entire 18.96% stake), following a similar buyout garnering 18.6% from minority stakeholders in August 2018.

Russia, MegaFon