MOSCOW Russia's richest man, Alisher Usmanov, has sold a 7.4 percent stake in internet group Mail.Ru (MAILRq.L) for around $530 million, to diversify his portfolio and increase Mail.Ru's liquidity, his holding company said.
Usmanov's technology-related bets have set him apart from his country's rivals and helped give him an estimated worth of $18.1 billion according to Forbes. He was an early investor in social media website Facebook (FB.O) and controls Russia's number two mobile operator MegaFon (MFONq.L).
Selling the stake in Mail.Ru, which operates popular social networking sites, and email and online games platforms, will reduce his interest to 17.9 percent from 25.3 percent, and his voting interest to 58.1 percent from 60.6 percent.
Usmanov's holding company USM Holdings said it was selling the stake as part of its general portfolio management and to diversify its assets, as well as to increase liquidity of Mail.Ru's stock. Its remaining stock is subject to a lock-up arrangement meaning he can sell no more shares for 180 days.
"We have no intention to sell any more shares after the expiry of the (lock-up) period and intend to maintain our economic and voting interest in the company at the current levels," USM said in a statement, adding it remained an "engaged and very committed" shareholder.
USM added that it viewed the Russian Internet sector as one of the most attractive investment opportunities globally.
The move led to speculation that Usmanov could invest in VKontakte - a similar platform to U.S. company Facebook.
"Usmanov could use the money to buy a stake in VKontakte," said analysts at Bank of America Merrill Lynch in a research note. They speculated that $500 million would be enough to buy a 25 percent stake in VKontakte from founding shareholders, who own 60 percent.
Mail.Ru, which this week forecast a slowdown in revenue growth, owns around 40 percent of VKontakte.
London-listed Mail.Ru announced plans for the share sale in a filing on Wednesday, saying that a company controlled by Usmanov called Ardoe Finance Ltd would place 15.5 million Mail.Ru global depositary receipts.
Sale of the shares was at the price of $34.25, an 8 percent discount to Wednesday's closing price of $37.40. That was the bottom of a $34.25 to $36 a share range, according to an industry source.
Mail.Ru's stock fell 9.6 percent to $33.80.
Renaissance Capital tech analyst David Ferguson said the placement - equivalent to 20 percent of Mail.Ru's free float - was likely to have a short-term negative impact on the company's share price but retained his buy rating on the stock.
Morgan Stanley (MS.N) acted as sole bookrunner in respect of the Mail.Ru placement.
(This story corrects name of Usmanov's company to USM Holdings (not USM Group) in 4th para)