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Home , Alexander Abramov, Alexander Mamut, Credit Bank of Moscow, Delo Group, Gennady Timchenko, Leonid Mikhelson

SSEECCUURRIIITTIIIEESS MMAARRKKEETT NNEEWWSSLLEETTTTEERR weekly

Presented by: VTB Bank, Custody

March 26, 2020 Issue No. 2020/11

Market News

An appeal of the President of the Russian Federation to the citizens On March 25, 2020 President Putin made an appeal to the Russian citizens with regards to the situation with the pandemic, and presented a package of measures to support businesses and the population. He declared a week from March 28 to April 5 as non-working, and presented a package of large-scale measures to support the population and small and medium-sized businesses. In addition to the measures to support business, the President announced that an income from bank deposits (i.e. interest accruals) will be subject to personal income tax (13%) if the amount of the deposit itself exceeds RUB 1 mln. This decision requires changes to the Russian Tax code. Putin also promised to eliminate preferential tax rates on dividends "for those who withdraw their income in the form of dividends to foreign accounts." This new measure would call for amendments to double-tax treaties. Ministry of Finance would further be working on the instructions announced by the President.

Moscow, bourses to hold trading on March 30–April 3, 2020 On March 25, 2020 it was stated that the Exchange and the Saint-Petersburg Exchange would hold trading on all markets from March 30 till April 3 despite the declared non-working week. President said earlier on March 25 that next week would be non-working for all with preservation of wages.

Company News

Alfa-Bank board approves purchase of 10% in TMK, Polymetal On March 19, 2020 the board of directors of ’s Alfa-Bank approved an acquisition of up to 10% in oil and gas pipe producer TMK and precious metals producer . A TMK representative stated that Alfa-Bank was yet to discuss acquisition of any shares in the company. TMK Steel Holding Limited, beneficiary owned by Chairman of the Board of Directors of TMK Dmitry Pumpyansky, owns 65.0584% in the company. TMK subsidiaries own 0.0445%, and free-float accounts for the remaining 34.8971%. ICT Group of tycoon Alexander Nesis owns about 27% in Polymetal, tycoon and his family owns 10%, and PPF Group NV of Petr Kellner holds 6.5%. More than 50% in Polymetal is free-float.

Mikhelson sells EUR 4.6 mln of ’s shares in repo deal On March 20, 2020 it was announced that , CEO of Russian independent gas producer Novatek, sold EUR 4.6 mln worth of the company’s shares during the first part of a repo deal. On March 17 Mikhelson sold 62,920 global depositary receipts (GDRs) for EUR 3.6 mln and 160,450 common shares for EUR 959,000. As a result of the deal, Mikhelson’s direct stake in Novatek fell to 0% from 0.026%. Earlier in March, Mikhelson several times bought shares of Novatek.

MTS says board of directors approves RUB 15 bln buyback program On March 20, 2020 it was reported that the board of directors of mobile operator MTS on March 19 approved an up to RUB 15 bln program to buy back common shares, including shares in the form of American Depositary Receipts (ADRs).

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Presidential aide Oreshkin seen appointed to Rosneftegaz's board On March 23, 2020 it was stated that the Russian government nominated five candidates to the board of directors of state oil and gas holding Rosneftegaz, including four current members and presidential aide Maxim Oreshkin. Oreshkin can replace First Deputy Prime Minister Andrei Belousov. The rest of the candidates are Andrei Akimov from ; Gennady Bukayev, CEO of Rosneftegaz; Sergei Ivanov from ALROSA; Igor Sechin from .

NLMK president buys minor stake in company for USD 473,447 On March 23, 2020 it was announced that Grigory Fedorishin, president of Russian steelmaker (NLMK), purchased a 0.00595% stake, or 35,678 shares, in the company for USD 473,447. The deal took place on the on March 19. Tycoon Vladimir Lisin holds around 81% in NLMK through Fletcher Group.

Central bank sees government acquisition of Sberbank stake closed early April 2020 On March 25, 2020 Sergei Shvetsov, First Deputy Chairman, said that the Russian central bank expects to close the sale of Sberbank stake in early April. The central bank owns a 52.32% stake of common shares of Sberbank, which translates into a 50% plus one share stake in the charter capital. The government plans to acquire the stake at a market price. The price was earlier estimated at about RUB 2.5 tln, but the stake may now cost about RUB 2 tln taking into account the recent contraction in shares of the bank.

Rosneft says buys back 750,000 shares, 750,000 GDRs on March 23, 2020 On March 26, 2020 it was reported that Russian oil major Rosneft bought 750,000 common shares and 750,000 global depositary receipts (GDRs) on March 23, during its first buyback deal since the announcement of the program. Taking into account the weighted average share price of Rosneft of RUB 270.4 on the , Rosneft could spend about USD 2.6 mln on the buyback. The shares were acquired by Rosneft's 100% affiliate RN-Capital. The weighted average price of the company’s GDRs on the London Stock Exchange was USD 3.432, and the deal price could be USD 2.6 mln. The board of directors approved the USD 2 bln buyback program in 2018, and planned to carry it out until the end of 2020. On March 23, Rosneft said that it eased the buyback terms but kept the amount and date.

TransContainer’s minorities submit 49.6% stakes for Delo’s buyback On March 26, 2020 it was announced that the minority owners of Russian leading railway container operator TransContainer, including Yenisei Capital of tycoons and and the country’s second largest bank VTB, submitted 49.6% in the company for a mandatory buyback offer of . Under the offer, the minority shareholders submitted 6,897,511 shares for the buyback, or a 49.641% stake. The purchase price is RUB 8,679.52 per share. The combined price of 99.641% in the company would exceed RUB 120 bln. Delo is to pay for the shares in 17 days, and it will use a credit line of Sberbank to finance the deal. Delo Group closed the RUB 60.3 bln purchase of 50% plus two shares in TransContainer from in mid-December 2019. Yenisei Capital owns 25.1% in the company, while VTB Bank has a 24.84% stake.

Dividends/coupons Raspadskaya board recommends paying RUB 2.83 per share in 2019 dividends On March 20, 2020 the board of directors of Russian producer Raspadskaya recommended paying RUB 2.83 per common share in dividends for 2019. The shareholders will consider the recommendation at an annual general meeting on May 19. The record date is June 8. Raspadskaya is part of U.K.-based steel and mining giant , which operates mainly in Russia.

Novatek can pay RUB 18 per share in final dividends for 2019 On March 23, 2020 the board of directors of Russian gas producer Novatek recommended paying RUB 18.1 per share and RUB 181 per global depositary receipt (GDR) in final dividends for 2019. The shareholders will consider the recommendation at an annual general meeting scheduled for April 24. The record date is May 8. The company paid RUB 14.23 per share, RUB 142.30 per GDR, or a total of RUB 43.2 bln, in dividends for January–June. According to the latest public data of Novatek, CEO Leonid Mikhelson controlled 24.75% in Novatek. Gas giant owns 9.99% in the company, tycoon ’s companies Ena Invest and Volga Group own 19.16% and 4.3%, respectively, and France’s Total has a 19.4% stake.

Mother and Child board recommends RUB 8.5 per share in dividends for 2019 On March 23, 2020 the board of directors of Russia’s Mother and Child maternity hospital and clinic chain, operated by MD Medical Group, recommended paying RUB 8.5 per share, or a total of RUB 639 mln, in dividends for 2019. The sum will amount to 23% of the International Financial Reporting Standards (IFRS)

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Federal Passenger Company board recommends no dividends for 2019 On March 23, 2020 the board of directors of Federal Passenger Company, a unit of Russian Railways, preliminarily recommended paying no dividends for 2019. In 2019, the company’s net profit rose 9% to RUB 6.629 bln, as calculated under Russian Accounting Standards (RAS). The company did not pay dividends for 2018.

Qiwi to allot 65–85% of 2019 adjusted net profit for dividends On March 24, 2020 it was reported that Russian payment service operator Qiwi plans to allot 65–85% of adjusted net profit in dividends for 2019. In 2019, the company’s adjusted net profit rose 61% to RUB 6.679 bln. The company also approved a target level for 2020 dividends at no less than 50% of adjusted net profit.

Russia’s to pay RUB 78.5 bln in dividends for 2019 On March 26, 2020 it was announced that Russian metals holding Metalloinvest would pay RUB 1.0478 per ordinary share, or a total of RUB 78.5 bln, in final dividends for 2019 by decision of its only shareholder – USM Holdings. In 2019, the company paid RUB 0.1402 per share, or about RUB 10.5 bln, in dividends for January–June. USM Holdings owns 100% in Metalloinvest, while core owners of USM Holdings are tycoons and Vladimir Skoch with stakes of 49% and 30%, respectively.

Eurobonds / DRs to buy back USD 200 mln of Eurobonds On March 20, 2020 it was reported that Credit Bank of Moscow planned to buy back up to USD 200 mln of Eurobonds of several issues. The offer covers the issues maturing in 2021, 2023, 2024 and 2025 denominated in the U.S. dollars and euros. The bank will post the results on March 27.

Etalon Group board offers to buy back 10% of GDRs On March 24, 2020 the board of directors of Russian developer Etalon Group suggested the shareholders to approve a buyback program for up to 10% of the global depositary receipts (GDRs) of the company. The period for which the bought securities can remain on the accounts of the company is no more than two years. Each GDR has 1 underlying share. The shareholders will consider the proposal at an annual general meeting.

Please be advised that the information presented in this newsletter is based on the following sources: National Settlement Depository (NSD); Clearstream Banking; Euroclear Bank; PRIME-TASS information agency; “Kommersant”, "Rossiyskaya Gazeta”, “Izvestiya, "Vedomosti”, “The Moscow Times“ newspapers, and others.

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