MOSCOW Nov 21 A dive for shares in Rostelecom
helped push Russia's stock market lower on Thursday on
disappointment over the price offered by the state telecoms
company to buy out shareholders who oppose a merger of its
mobile business with Tele2 Russia.
The rouble traded at a two-month low, hit by sluggish
economic growth and concerns over toughening regulation of banks
in Russia, as well as fears of tighter monetary policy in the
At 1235 GMT, the broad rouble-denominated MICEX share index
was down 1.1 percent at 1,491 points and its
dollar-denominated peer was down 1.6 percent at 1,424 points.
Rostelecom fell 3.6 percent. The company plans to spin off
its mobile business and merge it with Tele2 Russia, the
country's fourth-biggest mobile operator, before the end of the
Its board set a price for buying out those shareholders who
do not support the move which represented a premium over
Wednesday's closing price of 7 percent for its common shares and
15 percent for its preferred shares.
That made participation in the buyout only marginally
attractive, Uralsib Capital analysts said in a note.
VTB Capital analysts said they had expected Rostelecom stock
to fall as investors did not have to own the stock after the
record date, Nov. 20, and could sell it and buy it back later if
they wanted to take part in the buyout.
Other Russian stocks followed their emerging market peers
lower, as investors began ditching riskier assets after the
release of minutes from the U.S. Federal Reserve's last meeting
hinted at stimulus tapering.
Russian stocks are trading at an average share price to 2013
earnings ratio of about 6.5, said Andrey Kuznetsov, a strategist
at Sberbank Investment Research - a bit less than half the ratio
seen in countries in an index of emerging markets, partly due to
perceptions of weaker corporate governance in Russia.
Veteran emerging markets investor Mark Mobius said on
Thursday he had sold his fund's stake in Russia's TNK-BP
Holding, walking away from his attempt to get a better buyout
deal from the firm's new owner, Rosneft.
Mobius's exit follows a bruising exchange between minority
shareholders and Igor Sechin, the boss of Rosneft, a
state-controlled oil major.
Mobius's Franklin Templeton emerging markets group still has
more than $1 billion invested in Russian equities.
Rosneft traded down 1.1 percent, in line with other
"Although nobody is entirely bearish, we noticed a sensible
lack of optimism about the Russian economy and fixed-income
market," said Vladimir Osakovsky, an economist at BofAML, after
hosting a client trip in Moscow to visit Russian government
The rouble also fell victim to risk aversion and lower crude
The currency was 0.1 percent lower against the dollar
at 32.97 and 0.4 percent weaker versus the euro
, at 44.39.
This left the rouble also 0.3 percent weaker against the
dollar-euro basket at 38.11.
For rouble poll data see
For Russian equities guide see
For Russian treasury bonds see
Russia in graphics: link.reuters.com/dun63
(Writing by Lidia Kelly and Maya Nikolaeva; editing by Tom