INTERVIEW: Rostelecom may sell Central Telegraph building in Moscow
MOSCOW, Oct 11 (PRIME) -- State-controlled telecom operator Rostelecom is considering selling the Central Telegraph building in the Tverskaya Street, a Moscow main high-end arteria, and has already met with possible buyers, President Mikhail Oseyevsky told PRIME on Wednesday in an interview.
“We’ve already agreed with other shareholders on Central Telegraph and decided to retrieve all technological equipment from the building. We’ll later split the company into two divisions – an operating division and an owner of real estate. And we’ll decide on the future of the building. In general, now we understand that we’ll integrate the business of Central Telegraph into Rostelecom’s Center branch and then focus on structuring of the deal with the real estate,” Oseyevsky said.
Central Telegraph with 35,150 square meters is the biggest owner of premises in the historic building, while the communications ministry owns 10,000 square meters and rents 1,300 square meters from Central Telegraph.
Oseyevsky said the transaction will require a great deal of complicated agreements since the building is an architectural monument, “one of the capital’s symbols.”
“Several big players with understanding of a concept what can be done with it visited us. Creation of a modern multifunctional complex, which will comprise shopping zones, hotels, apartments, and restaurants are among the suggestions,” Rostelecom’s chief said.
Oseyevsky also said that raising Rostelecom’s stake in mobile operator T2 RTK Holding, which worries analysts because of a possibly mounting debt for Rostelecom, is not on the agenda. Rostelecom owns 45% in T2 RTK Holding, and the remaining 55% are held by a consortium of VTB Bank, Bank Rossiya, insurance group Sogaz, and businessman Alexei Mordashov.
“I’ve said many times that it’s content that counts for us, not the form. The content goal for all shareholders is to turn Tele2 into an effective company. Tele2’s team has reached good dynamics on the core indicators. This is why the matter of raising our stake is not discussed,” the executive said.
“We’re very happy with Tele2 that shows outstanding results on revenue growth and, what is more important, with margins. Their EBITDA margin for eight months of the current year exceeded 25%. I think that we’ll see Tele2 as a completely different company as of the end of 2017 than two years ago. I mean financial indicators.”
Rostelecom is also satisfied with evolution of the synergy of its cooperation with T2 RTK Holding, which raises margins and efficiency of both companies and allows them to offer clients new convergent products.
The state-controlled operator sees no urgent need to sell its quasi-treasure shares kept on the books of its unit Mobitel that owns 16.24% of its parent company’s capital, or 15.06% of common shares and 30.79% of its preferred shares.
“We believe that it’s important for us to show the market a new strategy, a strategy of transformation into a provider of digital services, because an idea about Rostelecom’s future is crucial for investors. Let’s see how the market responds to this strategy, how the quotes move. At present, we don’t have a pressing need to sell the quasi-treasure stock. At the same time, if we feel a serious interest on the market, we’ll certainly return to the matter,” Oseyevsky said.
The company’s head also said that Rostelecom is testing an option to provide mobile connection on the basis of fiber-optic lines laid under a digital divide bridging project, which is fulfilled under a state program and is aimed at providing small and remote areas with the Internet via Wi-Fi hotspots.
“I think tests will end successfully, and then we’ll have an opportunity to offer a completely different service to clients, and there is a need for it,” Oseyevsky said.
Rostelecom currently provides mobile connection services in 65 out of the country’s 85 regions as a virtual operator on T2 RTK Holding’s networks.