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. Last Updated: 07/27/2016

Sistema's Comstar Plans to Raise $1Bln in IPO

Comstar United Telesystems, which provides telephone services in Moscow and other cities, plans to raise about $1 billion in an initial public offering, people familiar with the sale said Friday.

Comstar UTS, a unit of Sistema, will begin selling stock on Jan. 23, said the people, who declined to be identified until the company makes an announcement.

The company plans to sell ordinary shares in Russia and global depositary receipts in London.

The IPO is set to be Russia's biggest since Sistema raised about $1.6 billion in February and comes as Russian stocks are trading at all-time highs. Comstar will use proceeds from the sale to help fund expansion.

"Russia and emerging markets are on the rise," Dmitry Kryukov, who manages $360 million at Kazimir Partners in Moscow, said Friday in a telephone interview.

While global telecommunication companies are out of favor, "Comstar's IPO will be defined by the interest toward the Russian market," Kryukov said.

A spokesman for Comstar in London declined to comment.

The Federal Service for Financial Markets on Thursday said that it cleared Comstar to sell shares abroad. Deutsche Bank's Deutsche UFG unit, Goldman Sachs Group and Renaissance Capital will manage the IPO.