MegaFon secures credit-line financing for Mail.ru Group stake buy

Russian telecommunications operator MegaFon and Sberbank have signed an agreement to open a 35 billion ruble credit line that expires 2024 to finance a stake acquisition in Mail.ru Group.

MegaFon said the funds would be used to finance the acquisition of 15.2% of shares in the authorised capital of Mail.ru Group (63.8% of voting shares).

It added that the agreement also changed the conditions of three existing credit lines for a total sum of 97.2 billion rubles, and which were taken out by MegaFon in 2012 and 2016.

The new conditions included lower interest rates and revised early repayment conditions.

MegaFon's CFO, Gevork Vermishyan, said the cooperation with Sberbank allowed the company to buy the Mail.ru shares on attractive terms.

"We are also optimizing the conditions of our existing credit lines, which allows us to improve their economic terms following the positive market dynamics, while retaining the required level of flexibility to manage our credit portfolio," he said.

Sberbank is MegaFon's largest creditor.