America’s TPG Capital fund, Russia’s VTB Capital and the European Bank for Reconstruction and Development will buy 44 percent of Lenta hypermarket chain from its core shareholder August Meyer and minority shareholders for $1.1 billion, a source close to the deal said on Tuesday.
The deal should put an end to a conflict between Lenta shareholders, who have been unable for more than a year to agree on a candidate for the post of the retailer’s general director and took the matter to a court.
“But the deal has not yet been closed,” the source said.
Currently TPG Capital and VTB Capital jointly own 30.8 percent of Lenta’s stock while the EBRD holds 11 percent. Meyer owns 40.6 percent of the shares while the rest is held by minority shareholders.
The shareholder conflict started last spring, when Meyer suggested the management board elect Sergei Yushchenko as a new CEO to replace Jan Dunning. VTB and TPG opposed the idea.
At the end of October, Dunning left the company and there is as yet no new CEO, as Lenta’s shareholder agreement requires mutual approval of a CEO. Lenta’s managers now take joint decisions.
The parties to the deal were unavailable for comment.