PPF Group NV, the private-equity firm controlled by Czech billionaire Peter Kellner, sold its 26.5 percent stake in Nomos Bank, becoming the latest international investor to retreat from Russia’s banking industry.
Moscow-based Otkritie Financial Corp., part-owned by state-run VTB Group, agreed to buy a 19.9 percent stake, Nomos said today in a statement. Alexander Mamut, a billionaire business partner of Nomos shareholder Alexander Nesis, is acquiring the remainder of PPF’s stake with Oleg Malis, it said. Terms of the deal weren’t disclosed.
Nomos shares tumbled after Kommersant reported that the stake may have been sold for less than its previous market value. Barclays Plc, HSBC Holdings Plc and Banco Santander SA are among international institutions that have abandoned consumer banking operations in Russia during the past two years as state-controlled banks increase their market share.
The “abrupt exit” of PPF from Nomos “looks like a first step to a merger with Otkritie, the new shareholder,” Alex Kantarovich, a banking analyst at JPMorgan Chase & Co. in Moscow, said today in a note. He cut Nomos shares to neutral from overweight.
Alexey Karakhan, a spokesman for Otkritie, declined to comment on whether Nomos is pursuing a full merger. Vedomosti newspaper said on July 17 that Nomos was close to buying Otkritie, citing an unidentified person.
Interfax reported that the Czech group sold its 26.5 percent stake for more than $700 million. That’s more than the $620 million valuation calculated earlier in a report by Kommersant, which reported that Otkritie may pay 12.8 billion rubles ($406 million) for its stake, a 13 percent discount to yesterday’s market value. Both reports cited people that weren’t identified.
Nomos fell 9.9 percent to 720.5 rubles in Moscow, and its London stock last traded 10 percent lower at $11.35. The shares fell as much as 14 percent in Russia, the most on record.
“PPF’s presence was positive for Nomos’s governance as PPF provided a second strong voice that could block major transactions,” Jason Hurwitz, senior analyst at Alfa Bank, wrote in an e-mailed report. “Today’s news thus could be negative from this perspective, as it would appear that the blocking stake would be broken up.”
Nomos expects the deal “to build on the successful track record of cooperation between Nomos and Otkritie” and welcomes the new shareholders, according to a statement that cited bank President Dmitry Sokolov.
Mamut is also an investor in Polymetal, the Russian silver and gold producer that joined the U.K. FTSE 100 index last year. Malis represents the telecommunications unit of billionaire Mikhail Fridman’s Alfa Group on the board of Turkcell Iletisim Hizmetleri AS, Turkey’s biggest mobile-phone operator.
Otkritie is suing several former employees, including George Urumov, over an alleged $183 million fraud involving Argentine warrants and bonuses for colleagues. Urumov denies any wrongdoing and says he was fired for exposing fraud involving his bosses and counterparties including OAO Sberbank, Russia’s largest lender, according to court documents from his employment lawsuit against Otkritie.
Nomos raised $718 million last year from an initial public offering in London and Moscow.
PPF, which bought into Nomos in 2007, will invest the proceeds from the sale in consumer lender Home Credit, electronics retailer Eldorado and real estate projects in Russia, the investment company said in a statement late yesterday. In July, the group said it owns at least 5.9 billion euros ($7.3 billion) of assets in Russia, including stakes in Nesis’s Polymetal International Plc, Home Credit and Nomos.