Russian retailer Magnit is providing Western investors with another chance to sell their shares as part of a buyback offer. This follows a successful buyback of nearly $490 million worth of shares last month, which accounted for about 21.5% of all outstanding shares.
This move allows more Western investors to withdraw their funds from Russia, a trend that has gained attention after Russia’s invasion of Ukraine in February 2022. Magnit’s decision reflects the changing dynamics of investment in Russia amidst geopolitical uncertainties.
In a significant move, Magnit allowed non-resident shareholders to sell their shares and receive payments in various currencies. This marked the first time such an option was available for shareholders of a Russian public company since the Western sanctions were imposed following Russia’s invasion of Ukraine.
Magnit decided to expand this offer due to the strong interest shown by non-resident shareholders, and they increased the offer substantially as a result. This decision reflects the changing circumstances influenced by the sanctions and countermeasures between Russia and the West.
Magnit has introduced a new tender offer for shareholders who wish to sell their shares and access cash for various reasons. This offer includes around 7.9% of the company’s shares, totaling 8,023,740 shares. It’s important to note that the offer won’t be expanded, even if there’s high demand from shareholders.
The company aims to provide an opportunity for shareholders to monetize their holdings in Magnit, especially those who couldn’t participate in the previous tender offer for various reasons. This move is part of Magnit’s strategy to accommodate different shareholder needs.
Shareholders have the opportunity to participate in this offer until November 8, and the results will be disclosed by November 15, with the deal expected to be finalized around November 29.
This transaction will be carried out through Magnit’s subsidiary, Magnit Alyans. The purchase price remains fixed at 2,215 roubles per share, and shareholders can choose to receive payment in dollars, euros, yuan, or roubles, whether they have accounts in Russia or abroad.
It’s worth noting that the Russian government has approved this transaction, which is subject to a 50% discount on asset sales involving foreign entities. Magnit’s shares in Moscow were trading at approximately 5,600 roubles each on Tuesday.
