Modern Times Group (MTG) plans to reduce its stake in CTC Media, Russia’s only publicly traded broadcaster, to 20 percent stipulated by the recently adopted law on foreign ownership in Russian media companies, but won’t pull out, according to Lorenzo Grabau, CEO of Investment AB Kinnevik.
“What matters is that we have a leadership position in influencing the way that the company operates,” Grabau was quoted as saying by Bloomberg. “We have lots of 20-percenters.”
He added that Kinnevik, which controls 48 percent of MTG votes, is prepared for a dramatic cut in MTG’s CTC holdings from current 39 percent to 20 percent as long as it keeps a strong voice in the company.
MTG’s spokesperson declined to provide any further comment. “We are, as we have stated previously, exploring all options that are available to us, and working in the best interest of all stakeholders,” he told The Hollywood Reporter.
Last month, President Vladimir Putin signed a law that reduces foreign ownership of Russian media companies to 20 percent stakes as of 2016.
CTC Media’s stock lost a third of its value this Fall on the news about the new foreign ownership requirement.
In the wake of the adoption of the regulation, CTC Media hired advisers from the law firm Morgan Lewis & Bockius LLP and accounting firm Habif Arogeti & Wynne LLC to help it comply. According to Grabau, there are “plenty of solutions” for reducing the stake.
