Gazprom's media assets will be fully controlled by Gazprombank

deal

As Kommersant has learned, negotiations are currently close to completion, as a result of which stakes in several companies included in the Gazprom-Media media holding will transfer from the Eurofinance Mosnarbank bank to the full control of Gazprombank. Both sides have so far refrained from making official comments, since the amount for which Eurofinance is ready to return the media assets received three years ago to the ownership of Gazprom structures is still unclear.

A high-ranking source in Gazprombank told Kommersant yesterday that negotiations between Eurofinance and Gazprombank are close to completion. Eurofinance officially refuses to comment on this topic. According to Kommersant's information, the matter is that stakes in several media companies that are part of the Gazprom-Media holding that were previously sold to Evrofinance will be returned to Gazprombank's balance sheet. We are talking primarily about 30.56% of the shares of NTV, 28.27% of TNT, 21.52% of NTV-Plus, 29.98% of M-Pul+ CJSC (it includes several Gazprom Media radio stations) ) and about 5% of the shares of the publishing house "7 days".

Let us recall that exactly three years ago, at the end of September 2002, when NTV and Gazprom Media were still headed by Boris Jordan, a large-scale deal between Gazprom, Eurofinance and Gazprom Media was loudly announced. Under the terms of the deal, Eurofinance received stakes in several media companies, and in exchange promised to invest $106 million in hard cash in them and to restructure Gazprom-Media’s $600 million debt to Gazprom. However, three years after the announcement of this deal many significant changes have occurred. This year Gazprom-Media turned into one of the subsidiaries of Gazprombank (and media assets, accordingly, transferred to the bank’s balance sheet), and the current head of the media holding, Nikolai Senkevich, was also appointed vice president of the bank on September 20. Mr. Senkevich, in addition to heading Gazprom-Media, also oversees the public relations department at Gazprombank. During the three years that it owned media assets, Eurofinance Bank showed no interest in them. During this time, Eurofinance did not begin to restructure the debt of Gazprom-Media, and its investments in the media holding companies in total, according to Kommersant information, amounted to no more than $40 million. The plan to create a new media holding, in in which Gazprom-Media would own 51% of the shares, and 49% would belong to Eurofinance.

The fact that Eurofinance could sell its shares in media companies was discussed back in the spring of this year. Even then it became clear that the lobbying capabilities of Eurofinance in government structures began to weaken (at the end of 2004 it turned out that the authorities no longer considered Eurofinance as a contender for Russian foreign banks, and in the spring of this year the bank did not become the buyer of 70% of the shares Ren-TV, which came under the control of Severstal Group). According to Kommersant's information, it was in the spring of 2005 that Gazprom Media first approached Eurofinance Mosnarbank with an offer to buy out its shares in NTV and other companies. Since then, the parties have met from time to time to clarify the financial parameters of the deal: Gazprom-Media offered to cover the bank’s expenses for purchasing NTV shares, and Evrofinance hoped to make money from that deal. According to a Kommersant source in Gazprombank, at the last stage of negotiations, Eurofinance was offered to compensate its costs for the purchase of media assets plus a refinancing rate (according to various sources, the transaction amount could be about $50-70 million). If this is so, then Eurofinance actually provided loans to Gazprom structures for the purchase of NTV on conditions that were not the most favorable for itself.

However, the logic of the current deal between Gazprombank and Eurofinance is quite obvious. Gazprombank is consolidating control over all media assets, transferring them to its balance sheet, gradually optimizing the management structure. And if Gazprom decides to get rid of its non-core assets in the coming years, then it will be more profitable to sell them, fully controlling 100% of the shares of all media companies. But even if such a decision does not follow in the coming years, full control over NTV, TNT and NTV-Plus is much more profitable than the option when there is another shareholder owning a blocking stake.

At the moment, according to Kommersant's sources in Gazprombank, the parties are negotiating the final amount of the transaction, according to which Evrofinance will sell Gazprombank's stakes back to Gazprom. The deal could be completed within a month.

Kommersant will monitor developments.

ARINA Kommersant-Borodina, Elena Kommersant-Kiseleva

Eurofinance leaves Gazprom Media