VTB acquires TCB shares from Russian Railways

15 July 2011

VTB acquires TransCreditBank shares from Russian Railways

JSC VTB Bank and JSC Russian Railways today signed a purchase agreement on the shares of JSC TransCreditBank (TCB) owned by Russian Railways. This deal will finalise the phased acquisition of TCB, approved by VTB Supervisory Council in October, 2010.

The deal will be divided into two stages. At the first stage, upon signing the purchase agreement, a stake of 29.4% TCB shares will be bought at a price of RUB 24.4 for each ordinary registered share.

The second stage, which will be concluded between 1 July 2012 and 31 December 2013, will include the purchase of 25% + 1 TCB shares. The price formula for this stake has been agreed and final price will be determined based on agreed performance indicators of TCB at the time of the closing of the transaction.

On 15 July 2011, VTB Bank and Russian Railways also entered into a shareholder agreement with respect to TCB. The agreement sets forth the obligations and liabilities of both shareholders to TCB and will remain valid until the second stage of the above mentioned transaction. In particular, the document provides for the parties to jointly manage TCB and facilitate its development as well as asset and profitability growth while following VTB Group management principles and standards.

Citing Andrey Kostin, VTB Bank President and Chairman of the Management Board, "Due to the deal signed today, VTB will grow larger and stronger while Russian Railways will get access to all products and services provided by VTB Group both domestically and abroad. VTB and TCB business structures and product offerings are simultaneously complementary and allow for significant synergies."

For reference:

On 4 October 2010, VTB Supervisory Council approved the phased acquisition of 100% of TCB. The deal contemplates the acquisition of TransCreditBank and it's subsidiary businesses engaged in leasing, factoring (TransCreditFactoring), and a processing company. On 31 December 2010, VTB consolidated a 43.2% share in TCB acquired from its minority shareholders.

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