Unicredit to sell its business in Ukraine

The largest Italian bank Unicredit signed a binding agreement for the sale of its business in Ukraine. Local credit institution subsidiary Ukrsotsbank will be transferred to Luxembourg-based investment company ABH Holdings (ABHH), which is part of the Russian financial group Alfa Group.

The sale of loss-making Ukrainian unit is part of the strategic plan of Unicredit to and including 2018, which was presented in November last year. It was confirmed that the countries of Central and Eastern Europe, including Bulgaria, remain a major strategic market in which the Italian group is ready to invest additional capital in the coming years. Unicredit owns the largest Bulgarian bank - Unicredit Bulbank and several financial companies in the country.

Loser business

Ukrainian Ukrsotsbank was the only subsidiary of Unicredit banks in Central and Eastern Europe, which ended 2014 at a loss, reminds Reuters. From published information about its sale it becomes clear that the transaction will cost the Italian group a total of about 852 mln. Euros. As part of the agreement Unicredit will receive newly issued shares of ABH Holdings, which will represent 9.9% of the capital of the Luxembourg company after the transaction. Milan-based institution will receive the right to appoint one member of the board of directors ABHH, and to initiate the listing on the Luxembourg Stock Exchange or the company to sell its stake in it five years after the finalization of the transaction.