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SITRONICS JSC (“SITRONICS Group”) (LSE: SITR), the leading provider of telecommunications, information technology and microelectronic solutions in Russia and the CIS, today announces the signing of legally binding agreements between SITRONICS Group and its major shareholder, RTI OJSC (“RTI”), and NVision Group Managing Company LLC (“NVision Group”) to integrate their IСT assets.
According to the agreements signed, SITRONICS Group will pay in part by way of a cash consideration of RUB 393 million, and will also participate in an additional share issue of NVision Group CJSC by contributing its ICT assets to NVision’s share capital (SITRONICS Telecommunication Solutions business line, excluding INTRACOM TELECOM, and SITRONICS Information Technologies business line). As a result of the transaction, the SITRONICS Group will own approximately a 37% stake in NVision Group.
Sergey Aslanian, President of SITRONICS, commented: “The ICT market has now entered a stage of consolidation, where the largest companies are acquiring niche players to broaden their competence and strengthen their influence. We have decided to make a stronger move and will integrate the assets of the largest IT companies to create the biggest player on the Russian IT market. In terms of providing synergies, the integration will combine the competences of our joint project teams and diversify the client portfolio. It will also enable us to offer unique solutions for customers in different segments of the business in various countries. Our representative offices now cover the whole of Russia from Vladivostok to St. Petersburg and include many countries in the CIS, Eastern Europe and South Asia. As a result of the integration, a new large market player has emerged, which will be able to carry out highly complex infrastructure projects and become a key partner for businesses and the State as they look to modernise and build an innovation-driven economy.”
Anton Sushkevich, President of NVision Group, commented: “We operate in the ICT industry, which is constantly changing to become more developed and complex. We believe that partnership is the most effective way to overcome difficulties and keep up with innovations. The level of experience and competencies of both companies’ professionals perfectly compliment each other, which will appeal to both customer bases. We believe that working together we can offer more, providing our customers with a greater range of products and services. First and foremost our partnership will be beneficial to the State and its long-term projects as we can offer reliable execution, unique technologies and the ability to implement projects efficiently and in a timely manner. We are confident that the integration will also support the industry, market and Russian economy as a whole, especially its high-tech segment.”
The completion of the transaction is expected by the end of the year and is subject to the fulfillment of a number of preconditions, including the receipt of all the necessary permissions from the State regulatory bodies, as well as execution of a number of separate transaction-related agreements.