Lenta’s minority owner asks directors to start talks with Magnit

MOSCOW, Apr 11 (PRIME) -- Prosperity Capital Management, a minority owner in Russian retailer Lenta, has sent a letter to the retailer’s independent directors asking for clarification of a possible sale of shares to Severgroup and requesting to start negotiating a similar deal with retailer Magnit, as seen by PRIME in the letter late on Wednesday.

On April 2, Severgroup of tycoon Alexei Mordashov agreed to buy a 41.9% stake in Lenta for around U.S. $729 from TPG Group and the European Bank for Reconstruction and Development (EBRD).

But on April 5, Lenta said it received a non-binding proposal to buy 100% in the company from another retailer, Magnit, on April 1, it offered price $3.65 per global depositary receipt compared with Severgroup’s $3.60, but Magnit said that Lenta did not respond to the offer.

In its letter, Prosperity Capital Management expressed concern with how the board dealt with the offers. It asked for clarification why the board chose Severgroup over another offer and what advantages it has over the offer of Magnit.

“If the board of directors rejected, or if it wants to reject Magnit’s offer, could the board provide detailed reasons for that? If the board did not respond or does not plan to respond to Magnit, what reasons does the board have for that?” the letter read.

Prosperity also asked whether Severgroup had any voting shares in Lenta prior to the deal.

“We also ask you to start negotiations with Magnit on a possible acquisition of Lenta and to provide help to Magnit necessary for submission of a corresponding bid to the Federal Antimonopoly Service,” Prosperity said, adding that it will send a similar letter to the ethics commissions of TPG Group and the EBRD.

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