UPDATE 1-Rostelecom to delist from NY stock exchange

Fri Dec 11, 2009 9:43am EST

* To delist American Depositary Receipts

* To remain listed on local stock exchanges

* Says delisting will free up resources (Adds details, background)

MOSCOW, Dec 11 (Reuters) - Rostelecom ROS.N, Russia's largest long distance call operator, said it would delist from the New York Stock Exchange as part of a reform of the state telecoms sector, though it will remain listed on local bourses.

The Russian government plans to combine seven state-run regional telecoms groups under Rostelecom with the aim of boosting efficiency and market share of their controlling shareholder, Svyazinvest. [ID:nLK486977]

Sources earlier said Rostelecom was likely to delist its American Depositary Receipts, which originally accounted for less than 5 percent of the company's equity, from NYSE as they would complicate the merger.

"The decision to delist from the NYSE will free up a significant amount of capital and administrative resources necessary for the company's strategic development," Chairman Yevgeny Yurchenko said in Friday's statement.

Rostelecom also said that trading in its shares on Russian bourses (RTKM.MM) (RTKM.RTS) accounted for more than 99 percent of its overall trading volumes over the past 12 months.

Yurchenko, who is also the chief executive officer of Svyazinvest, said in May that the reformed company could make a public share offer once its reorganisation is complete, and that the offer would not take place on the NYSE. [ID:nLU70615] (Reporting by Maria Kiselyova; Editing by Greg Mahlich)

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