* Loans raised to buy out Fridman’s 25 pct stake
* TeliaSonera to get special dividend - sources
* MegaFon plans $4 bln IPO in London
* Tavrin to be CEO with immediate effect
By Maria Kiselyova and Douglas Busvine
MOSCOW, April 20 (Reuters) - MegaFon has borrowed $4.5 billion to help finance a buyout of Mikhail Fridman’s 25.1 percent stake, bringing Russia’s No.2 mobile phone operator closer to a possible $4 billion London IPO later this year.
MegaFon also named Ivan Tavrin as chief executive on Friday, putting in place another part of a transaction that will hand control to Alisher Usmanov, Russia’s richest man with a fortune estimated at $18.1 billion.
The ownership shake-up and initial public offering, which would be the largest in London since commodities trader Glencore floated last May, seeks to position MegaFon for the costly rollout of next-generation 4G mobile services in Russia.
Outgoing CEO Sergei Soldatenkov has been tipped to become telecoms minister in President-elect Vladimir Putin’s next administration. Tavrin, who joined MegaFon this year, used to work for media group UTV, in which Usmanov is a shareholder.
MegaFon said it had obtained a credit line of up to $1.5 billion from state-controlled lender Sberbank. State-owned Gazprombank later said it had lent MegaFon $1 billion for five years in a two-tranche deal.
Earlier this week, MegaFon took out a $2 billion syndicated loan from Western banks, adding to $1.5 billion net cash on its balance sheet it can spend on the deal.
While the deal’s final structure is not finalised, MegaFon was expected to buy part of Fridman’s 25.1 percent stake, valued at $5 billion, with Usmanov acquiring the rest, one banking source familiar with the matter told Reuters.
In the IPO of a 20 percent stake, tentatively planned for the second half of 2012, TeliaSonera would sell two thirds of the shares on offer, with the rest coming from stock held in treasury by MegaFon, the source said.
Two sources said TeliaSonera would also receive a special dividend. “The only way to counterbalance the market risk (of an IPO) is to give the company additional liquidity through a dividend,” the banker said.
MegaFon, Usmanov, TeliaSonera and Fridman have declined to comment on the talks.
The transactions are being structured so that Usmanov, who has a 31.1 percent economic interest in MegaFon, will secure overall control, while TeliaSonera, which now owns 43.8 percent, will be a minority partner.
Usmanov and TeliaSonera own part of their MegaFon stakes through holding company Telecominvest, which Usmanov controls. That effectively gives him a 39.3 percent current voting stake compared with TeliaSonera’s 35.6 percent.
Cancellation of some treasury stock held by MegaFon as a result of the Fridman buyout would help push Usmanov’s voting interest over the crucial 50 percent threshold.
Bankers, meanwhile, have said MegaFon was preparing to pick banks to run an IPO that would give MegaFon an equity value of $20 billion - a premium to rivals MTS and Vimpelcom .
“The company does not deserve a discount. It has great prospects. It managed to grow to No.2 over a short period of time and has a strong position in mobile broadband,” said Yevgeny Golosnoy, a telecoms analyst at Nomos Bank in Moscow.
“But a premium is unlikely because it is a new company for the market. If it places at (the same multiples as) MTS, it will be a good result.”
Market leader MTS’s enterprise value - the cost of buying a company and its debt - is 4.6 times forecast 2012 earnings before interest, taxation, depreciation and amortization (EBITDA).
Applying that multiple to MegaFon, before accounting for the latest borrowing, yields a valuation of around $17.3 billion, said Konstantin Chernyshev, head of research at Uralsib.
“I do not think anyone will pay a 10 percent premium, in particular because the money raised through IPO will go to shareholders and not to the company,” said Chernyshev, adding planned stock offerings by Sberbank and VTB this year could sap investor appetite.