MOSCOW, August 3 (RIA Novosti) - Russia's largest mobile communications operator Mobile TeleSystems (MTS) has offered $1.27 billion for a 51% stake in Moscow's biggest multiservice communications operator, Comstar-UTS, a report said on Monday.
The price, at which MTS will buy a controlling stake in the fixed line communications and broadband Internet operator, may amount to $5.98 per Global Depositary Receipt or $1.27 billion for the whole 51% package, a source close to a company belonging to AFK Sistema, which controls both MTS and Comstar, told Vedomosti.
In June, Russia's Anti-Monopoly Service approved an MTS application to buy up to 100% of Comstar.
However, MTS will buy out only 51% of the company's stock. MTS is not obliged to announce an offer for the purchase of shares from other shareholders upon the acquisition of a stake of over 30% as the deal will not lead to the change of the package's ultimate owner, AFK Sistema, the paper said.
The price of $5.98 per GDR is almost 25% higher than the price for Comstar's GDR on the LSE as of July 23. The deal will enable MTS to compete successfully with its main rival, VimpelCom, on the broadband Internet access market, the paper said.
The deal is also advantageous for AFK Sistema, which will receive funds to settle its debts, the paper said. According to data in late March, the company needed to repay about $900 million in debts in the second half of the year.
