Russia-China investment fund acquires 23.1% of Detsky Mir, to nominate two directors
MOSCOW. Jan 11 (Interfax) - The Russia-China Investment Fund (RCIF), formed by the Russian Direct Investment Fund (RDIF) and China Investment Corporation (CIC), has closed the acquisition of 23.1% of children's goods retailer Detsky Mir and will nominate two members of the board of directors, the RDIF said in a press release.
The shares were acquired from CJSC DM Finance, which is a subsidiary of AFK Sistema, for 9.75 billion rubles.
"Under the terms of the agreement, significant funds from the transaction will be invested in expanding Detsky Mir's nationwide network of stores and further developing its logistics platform. This will also extend its modern sales and distribution channels for children's products throughout Russia and the CIS. Additionally, the Group is considering opportunities for international expansion in the mid-term perspective," the RDIF said.
Upon completion of the transaction Sean Glodek, Deputy CEO of the RDIF, and Lei Teng, Senior Vice President of the RCIF, will be nominated to the board of directors of Detsky Mir on behalf of RCIF. The RCIF will receive two of ten seats on the Detsky Mir board.
"Detsky Mir is building an amazing success story in children goods retail in Russia and the CIS. Partnership with Sistema and Detsky Mir offers a great experience for RCIF, and we are glad to take our relationship with them to the next level and to support Detsky Mir's development and expansion to international markets, including China and other counties. The deal is in line with our investment strategy focused on growth of the middle class and its demand for goods, especially in the regions," said Kirill Dmitriev, CEO of RDIF and co-CEO of RCIF.
"We are confident that Detsky Mir is well positioned to operate successfully in the challenging market environment. The company continues to expand and we hope that RCIF's investment will support its growth and further enhance its performance," said Hu Bing, co-CEO of RCIF.