Gazprombank Cancels Dresdner Deal

MTMatthias Warnig
Gazprombank, the finance arm of gas monopoly Gazprom, has decided against selling one-third of its equity to Dresdner Bank for $800 million, the bank said Wednesday. The plan announced last December was aimed at preparing Gazprombank, the country's No. 3 bank, for an initial public offering of shares. Dresdner said at the time that it was acting as a financial and not strategic investor, and one banking source said it would re-sell the stake shortly after the IPO.

"The shareholders of Gazprombank have declined Dresdner's offer because of its low price attractiveness," a Gazprombank spokesman said.

The spokesman said the stake would go to Gazprom's pension fund affiliate Gazfond instead, while Dresdner would still play an unspecified role in the IPO.

"The IPO is still possible, and we are working on the basis that it may take place in 2007, depending on the market situation. We expect Dresdner to be included in the preparations."

Dresdner Bank's investment banking arm Dresdner Kleinwort Wasserstein has had a close relationship with Gazprom, advising the gas giant on its recent $13 billion purchase of oil company Sibneft, the largest takeover in Russia. It played a key role in raising a syndicated loan to finance the purchase.

But two key executives have recently quit.

Investment banking head Bob Foresman left to join rival bank Renaissance Capital and Dresdner Kleinwort Wasserstein chairman Matthias Warnig has taken up a job as head of Gazprom's North European Gas Pipeline project.

Gazprom owns 87.5 percent of Gazprombank directly and the rest indirectly. Analysts had said the original deal with Dresdner would help make Gazprombank more transparent.

Officials at Dresdner were not immediately available to comment.