Stake acquisition in the lender, formerly known as the Moscow Bank for Reconstruction and Development (MBRD), will help the telecom firm to enhance financial services business to its 70 million customers in Russia.
Following the completion of share purchase, the acquirer will induct its representative in the bank’s board to influence commercial decisions, as reported by the Financial Times.
The deal has already been approved by the firms’ board, which is expected to close in early 2013, after obtaining regulatory approvals.
The mobile service provider operates more than 4,200 stores in the country, which provides a readymade platform to market its financial services.
A controlling ownership of the two companies is held by the Russian conglomerate Sistema, which owns half of MTS and nearly 87% of the bank, as reported by the news agency.
Following the completion of the transaction, Sistema’s stake in the bank will be reduced to two-thirds.
Sources close to the matter further told the news agency that a "fairness opinion" on the deal was provided by Citigroup.
