June 25 (Reuters) – MTS (MBT.N), Russia’s No.1 mobile phone operator has offered to buy out minorities in Comstar (CMSTq.L), at a premium to the market, Kommersant business daily reported on Friday.
By persuading more minorities to part with stakes through offering a higher price, MTS should be able to buy more shares and will have to swap less of its own stock for Comstar’s in order to complete the acquisition. Thus MTS’s parent AFK Sistema (SSAq.L) should be able to keep control of the end company.
MTS may spend 8.3 billion roubles ($268 million) buying out minorities in its fixed line unit at 220 roubles per share, Kommersant said citing sources familiar with the deal.
The shares at Comstar closed at $6.55 per GDR, which is equal to one share, on Thursday, implying the buyout price of 220 roubles ($7.10) offers an 8.4 percent premium.
If the minor shareholders agree to sell more than 9 percent in Comstar MTS would buy the excess shares at 213 roubles per share, Kommersant said.
The merger would enable MTS to take full advantage of the synergies from its 2009 acquisition of a controlling stake in Comstar, in which it now holds 62 percent.
Shareholders who do not take up the buyout offer would swap one share in Comstar for 0.825 shares in MTS, Kommersant said.
(Reporting by Dmitry Sergeyev; Editing by Mike Nesbit)
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