Moscow, Russia - October 1, 2013 - Sistema JSFC ("Sistema") (LSE: SSA), the largest publicly-traded diversified holding company in Russia and the CIS today announces that it has completed the acquisition of a 100% stake in LLC Bashneft-Services Assets ("BNSA" or "the Company") from JSOC Bashneft ("Bashneft") for a total cash consideration of RUB 4.1 billion. The value of the stake is based upon an independent appraisal.
BNSA is an oil services company focused on onshore drilling and work over operations, equipment servicing and manufacturing, transportation and construction. In 2012, the Company operated a fleet of 104 drilling rigs, 180 workover rigs and more than 5,000 transportation vehicles.
The Company primarily operates in Volga-Urals, Komi, Khanty Mansiysky and Nenetsky Autonomous regions. Its largest contractor is Bashneft with a total share of drilling amounting to 52% in 2012.
Sistema's plans over the medium term include improving and optimising the Company's costs and operations, establishing transparent and competitive bidding process, renovating and upgrading the Company's asset base, as well as expanding its client base. BNSA development will be funded by the Company's own cashflow, as well as external financing if required. It is anticipated that Bashneft will remain one of the Company's largest contractors.
Mikhail Shamolin, President and CEO of Sistema commented:
"Sistema's acquisition of Bashneft oilfield services provides an attractive entry into the world's second largest oilfield services market. The sector has expanded rapidly in recent years supported by Russia's growing oil production from new and mature fields. These fundamentals, combined with Bashneft's desire to focus on its core business of upstream and downstream production, provide Sistema with a unique opportunity to unlock BNSA's full value potential.With a clear development plan, substantial existing sector expertise and possible future partnership opportunities we believe we can transform this Company to one of the leading oil services providers in Russia."
For further information, please visit www.sistema.com or contact:
Tel.: +7 (495) 692 1100
Tel.: +7 (495) 228 1536