MOSCOW, July 9 Russia's second biggest mobile
phone operator Megafon has finalised its
2012 deal to buy a stake in cellphone retailer Euroset, paying
its key shareholder $657.3 million in shares, the company said
Megafon, controlled by Russia's richest man Alisher Usmanov,
together with his acquisition vehicle Garsdale, bought 50
percent of Euroset for $1.07 billion nearly two years ago. The
other 50 percent in Euroset belongs to Megafon's competitor,
The initial deal envisaged Megafon gaining full control of
the Euroset stake within a year, buying 25 percent from Garsdale
within a year. The condition was later extended until 2015.
The price paid in the deal corresponded to the $535 million
initial investment plus $50 million in additional payments
representing Garsdale's "earn out", as well as accumulated 8
percent interest, Megafon said.
"Megafon has completed its commitment to Garsdale with
respect to the Euroset transaction at this time in order to
eliminate a sizeable foreign currency liability from the
company's balance sheet and reduce the average cost of our
debt," Megafon Chief Executive Ivan Tavrin said in a statement.
"We used our treasury shares instead of cash as the currency
of payment to retain adequate liquidity position in volatile
credit market environment."
(Additional reporting by Alexei Kalmykov; Writing by Lidia
Kelly, editing by David Evans)