Rosbank becomes part of the business empire of Potanin, the largest shareholder in Norilsk Nickel (NILSY), the world’s largest producer of palladium and refined nickel. Potanin’s holding company had been owned by Rosbank since 1998 before Societe Generale (SCGLF) (SocGen) bought a stake in 2006 and merged it with its other Russian operations in 2010.
While he was not sanctioned by the European Union, Potanin was sanctioned by the Canadian government over Russia’s invasion of Ukraine, which Moscow describes as a “special military operation.”
SocGen had previously warned of the risk of a write-down on its Rosbank stake.
Shares of France’s third-largest bank rose as much as 8% on Monday after it announced it would end its more than 15-year stake in Rosbank amid mounting pressure to sever ties with Russia.
SocGen did not disclose what Interros Capital was paying for the stake, but said the deal would allow it to exit Russia in an “effective and orderly manner” and ensure continuity for Rosbank’s employees and customers.
Interros said in a statement that the deal should be finalized in the next few weeks after receiving all the necessary regulatory approvals.
SocGen said the deal would result in a write-down of about 2 billion euros ($2.2 billion) and an exceptional non-cash item, but would have no impact on SocGen’s capital ratio.
The writedown will be “largely offset” by the deconsolidation of its €15.4 billion exposure in Russia and an unspecified payment, including the repayment of subordinated debt by Interros Capital, SocGen added in a statement.
SocGen first acquired a stake in Rosbank in 2006 with an option to acquire a controlling interest in 2008. The Russian bank was fully merged with SocGen’s other Russian operations in 2010.