Russian Telecom Giant Mulls CTC Media Acquisition (Report)
Under the Russian law, the broadcaster will have to cut its foreign-owned share from 75 percent to 20 percent.
Russia’s telecom giant Rostelekom is reportedly considering the acquisition of the broadcaster CTC Media, partly owned by Sweden’s Modern Times Group and affected by a law restricting foreign ownership of media companies.
The Russian business daily Vedomosti quoted anonymous sources in Rostelekom as saying that negotiations about acquiring CTC Media are in progress.
An MTG spokesman declined to comment on the report.
The Russian government holds a 47-percent share in Rostelekom and another four percent is owned by the state-run bank VEB. The remaining shares are publicly traded.
Under a newly adopted law limiting foreign ownership in Russian media companies by 20-percent stakes, CTC Media will have to be majority-owned by a Russian company by 2016.
Meanwhile, 75 percent of the company is currently in foreign ownership, of which 39 percent is controlled by MTG and another 36 percent is traded on NASDAQ.
The remaining 25-percent share is reported to be owned by Yuri Kovalchuk, an entrepreneur close to president Vladimir Putin and affected by sanctions slapped by the United States and the European Union last year over Crimea.
When the media ownership law was adopted in late 2014, MTG said it was prepared for a dramatic cut in its CTC holdings to 20 percent as long as it keeps a strong voice in the company. Later, the media group said it didn't rule out selling its entire stake in the Russian broadcaster.