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Money News

Sistema, Russia-China fund raise $281 million from sale of toy retailer

FILE PHOTO: A board, showing the logo of Russian children's goods retailer Detsky Mir, is on display outside its store in Moscow, Russia, February 10, 2017. REUTERS/Maxim Shemetov/File Photo

MOSCOW (Reuters) - Russian conglomerate Sistema said on Wednesday that it and the Russia-China Investment Fund (RCIF) had raised 20.7 billion roubles ($281 million) from the sale of 25% of shares in Russia’s biggest toy retailer Detsky Mir.

The sale, which follows others by the partners this year and in 2019, sees them exit Detsky Mir entirely. It also makes Detsky Mir, which sells toys, baby food and other products, the first Russian company with a free float of 100%.

The sale of 184.75 million shares via a so-called accelerated bookbuilding process was priced at 112 roubles per share, with a 1% discount on the price of Detsky Mir’s shares at market close on Tuesday, Sistema said in a statement.

The retailer, which has increased the number of its stores by more than a third to 850 since listing in 2017, plans a new compact format to target smaller towns and boost online sales.

Since Detsky Mir’s listing in 2017, Sistema gained more than 60 billion roubles from sales of shares and dividend payments from the company, it said.

The majority of the shares were sold to foreign investment funds from Britain and the United States, Sistema added. Credit Suisse, Goldman Sachs, Sberbank CIB, VTB Capital and Alfa Bank arranged the deal.

Sistema and RCIF - a joint venture of the Russian Direct Investment Fund and the China Investment Corporation - sold 20.38% and 4.62% in Detsky Mir, respectively.

Reporting by Nadezhda Tsydenova; writing by Polina Devitt and Maria Kiselyova; editing by Tom Balmforth and Louise Heavens

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