Three sovereign wealth funds have subscribed for all of Russian state-backed bank VTB’s upcoming $3.3bn equity issue.
The bank will issue 2.5 trillion new shares at a price of RUR0.041 per share to raise up to RUR102.5bn ($3.3bn).
New and existing investors including Norway’s Norges Bank Investment Management, Qatar Holdings and the State Oil Fund of Azerbaijan have made binding commitments covering the entire amount of the offering, VTB said.
The three funds subscribed to more than 50 per cent of the offering, said Russian news agency Prime.
The equity issue will increase the bank’s Tier 1 capital and total capital ratios to 11.9 per cent and 60.93 per cent respectively and fund its growth plans.
It will also reduce the Russian government’s stake in VTB to 60.93 per cent from 75.5 per cent. It is expected that Russia’s Federal Agency for State Property Management will exit its stake in the bank completely by 2016.
VTB chairman Andrei Kostin said, “Binding commitments to subscribe from major global investors have allowed us to secure our capital raising targets.
“We are introducing new strategic shareholders and strengthened our relationship with existing major investors whilst offering all current shareholders the chance to participate, and have achieved a transaction in ordinary shares quoted on the Moscow Exchange in line with government policy.
“The transaction allows us to meet our capital adequacy targets, and also provides funding for the continued growth of the business.”
VTB makes private equity and venture capital investments via its investment arm VTB Capital.
Some of its recent deals included an investment in Russian online hotel reservations agency Oktogo.ru.
Late last year VTB Capital led a consortium to buy a controlling stake in Bulgarian telecom operator Vivacom and partnered with global advisory firm Evercore Partners to advise on cross border deals between Russia and North America.
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