Russian state-controlled pipeline monopoly Transneft will acquire a 25%+1 voting share stake in Ust-Luga Oil, one of the largest oil products sea terminals on Luga Bay in Northern Russia, Vedomosti daily and Reuters reported citing the approval of Federal Antimonopoly Service (FAS).
"Marine transshipment of oil products is a high-margin business and implies synergy with Transneft’s operations," Gazprombank commented on October 30. The amount of the deal was not disclosed, but the whole terminal may be valued at $1.2-1.25bn, making Transneft's stake worth $300-600mn.
The analysts note that the acquired asset fits well with Transneft’s business model and implies synergy with the company’s core operations and infrastructure. Ust-Luga Oil terminal's capacity is 30mn tonnes annually, with the main shippers being domestic oil majors Rosneft, Surgutneftegas, and Gazprom Neft.
The main shareholders of the terminal are oil trader Gunvor Group Ltd (26%) and billionaire Andrey Bokarev (74%). According to Vedomosti Transneft will acquire part of Bokarev's stake.
Ust-Luga Oil revenues in 2016 were RUB23.7bn ($355mn), with a net income of RUB18.3bn. Gazprombank estimates the Ebitda margin of the company at 90%, more than double the margin of Transneft of 40%. The bank also notes that in 2016 Ust-Luga Oil considerably reduced its leverage, cutting net debt/Ebitda ratio from 1.9x to 0.7x as of end 2016, with net debt of about RUB14.4bn ($240mn).
The state holds 78.1% of Transneft's ordinary shares while 21.9% of preferred shares are in free float. In September the company confirmed RUB27.6bn or RUB3,875 per share in interim dividends for January-June 2017, following its report of International Finance Reporting Standards (IFRS) results for the period. The payout corresponds to 24% of IFRS net profit, which is below the 50% of IFRS requested by the Finance Ministry which is struggling to scrap dividends from state-controlled majors.
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