VTB, Russia’s second largest lender, is issuing 2.5 trillion new shares to help boost its equity capital and strengthen its shareholder base with new strategic investors.
It is expected to raise RUB102.5bn ($3.28bn).
It said in a statement on Monday that it had received “firm and binding commitments” from new and existing shareholders, including three prominent sovereign wealth funds: Norges Bank Investment Management in Norway, the state oil fund of Azerbaijan (SOFAZ) and Qatar Holding, to subscribe for the entire amount.
The transaction is expected to be finalised after May 17, when the pre-emptive subscription period ends. VTB said it did not expect its present largest shareholder, Russia’s Federal Agency for State Property Management to exercise its statutory pre-emptive rights to buy the shares at RUB0.041 each.
In a statement, VTB chairman Andrey L Kostin said: “We are delighted to announce the capital increase and are pleased with the transaction structure. Binding commitments to subscribe from major global investors have allowed us to secure our capital raising targets.
“We are introducing new strategic shareholders and [have] strengthened our relationship with existing major investors whilst offering all current shareholders the chance to participate, and have achieved a transaction in ordinary shares quoted on the Moscow Exchange in line with Government policy.
The transaction allows us to meet our capital adequacy targets, and also provides funding for the continued growth of the business.”
It has not been revealed what percentage of the new shares Qatar would buy.
It was reported in February the deal may not go ahead over a disagreement about the share price.
Russian President Vladimir Putin also has been pushing for all further state asset sales to be held in Russia, putting the entire capital raising exercise in jeopardy.