Russian investment company Sistema to acquire Investlesprom's assets from Bank of Moscow

Apr 04, 2014. /Lesprom Network/. Sistema JSFC ("Sistema") (LSE: SSA), the largest publicly-traded diversified holding company in Russia and the CIS, announced that its subsidiary LLC LesInvest has signed legally binding agreements with the Bank of Moscow to acquire 100% of OJSC Segezha Pulp and Paper Mill and 100% of LLC Derevoobrabotka-Proekt (the "Group") together with all debt obligations to the Bank of Moscow on debt free cash free basis. These assets were part of Investlesprom holding company. The closing of this transaction is contingent upon the approvals of relevant anti-monopoly authorities. The transaction is expected to be completed by the end of the third quarter of 2014.

According to Sistema, the Group is the largest manufacturer of sack paper and paper sacks in Russia and the second largest producer of paper sacks in Europe. It is also one of the largest manufacturers and exporters of timber products and ply wood in Russia. In 2013, the Group's estimated revenue and EBITDA amounted to approximately RUB 20.9 billion and RUB 2.4 billion respectively, according to the management accounts. Export accounted for 54% of the Group's total revenue.

Mikhail Shamolin, President and CEO of Sistema, commented: "The companies we have acquired are leaders in their industries and offer exciting prospects. They generate stable cash flow and have substantial turnaround potential, which Sistema is well placed to realise. We intend to maximise shareholder value by restructuring the businesses, introducing a number of efficiency measures, modernising production and expanding into new export markets." 

Further details on this transaction can be found in the presentation