Modern Times Group (MTG) has denied suggestions in the Russian press that it has held talks with Telcrest Investments, the Cyprus-based investment vehicle controlled by Rossiya Bank, to sell its 39% stake in the company ahead of the imposition of new restrictions on foreign ownership of Russian media assets.
Russian newspaper Vedomosti reported that multiple sources close to CTC Media and MTG had told it the Swedish group was studying the sale of its entire stake in CTC Media and that UBS, the bank recently appointed by MTG to study options ahead of the new media law, had approached potential investors.
The report led to speculation that Telcrest, which owns a 25% stake in the company, would be the most likely buyer. The remaining 36% of the company is publicly traded. According to the reports, MTG decided against a partial sale to take its holding to 20% because of the legal complexities involved.
MTG has denied holding discussions with Telcrest about the sale of its stake.
“The process is clear. CTC Media is working with its appointed advisers including UBS to identify, evaluate and implement actions to ensure compliance with the amended Mass Media Law and to best protect the interests of CTC Media stockholders. CTC Media is considering all potential structures in this regard, which may include corporate restructuring, franchising and licensing structures, capital reorganization or divestments. MTG is not pursuing any separate process in relation to our holding in CTC Media, and the suggestion in a local Russian newspaper this morning that we have held discussions with CTC Media shareholder Telcrest, its shareholders or intermediaries, regarding the sale of our shareholding in CTC Media, is wrong,” the company said.
Foreign investors have until next year to reduce their stakes in Russian media companies to a maximum of 20% under new rules introduced by the government.
Rossiya Bank chief Yuri Kovalchuk is a close associate of Russian president Vladimir Putin and one of several individuals sanctioned by the US Treasury Department last year in response to the Russian annexation of Crimea.