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. Last Updated: 07/27/2016

Gazprom Talk Fuels Mosenergo Surge

Itar-TassShares in Mosenergo soared on both the RTS and MICEX bourses, prompting the RTS to suspend trading for an hour.
Trading in Mosenergo, the country's largest thermal power generating company, was suspended for an hour on the Russian Trading System after the stock rose as much as 13 percent.

Trading was halted at 3:45 p.m. and resumed one hour later, said Oksana Zaitseva, a spokesman for the RTS. The exchange suspends trading when a stock rises more than 10 percent in a day. Mosenergo shares most recently traded at 26 cents on the RTS.

On the MICEX stock exchange, Mosenergo shares rose as much as 11 percent to 6.88 rubles and traded recently at 6.68 rubles.

Trading in the stock was suspended Feb. 9 on both exchanges. The shares climbed 36 percent to 7.21 rubles on the MICEX that day.

"It's hard to say who is buying, but given that Gazprom has some big plans for Mosenergo, it could go a lot higher," said Kirill Surikov, director of international equity sales at Alfa Bank.

Gazprom, the world's biggest producer of natural gas, plans to swap a stake in its petrochemical unit Sibur Holding for 13 percent of Mosenergo, Vedomosti reported Tuesday, citing unidentified managers at Gazprom.

Gazprom owns 20 percent of Mosenergo directly and another 13 percent via its banking unit Gazprombank and pension fund Gazfund. Gazprom's board will discuss the swap at the end of February, the newspaper said.

Gazprombank Deputy CEO Alexander Sobol said Monday that the bank owns about 10 percent of Mosenergo shares. He added that the bank is a "portfolio investor" rather than a strategic investor.

"Owning a stake in Mosenergo is not our strategic goal," Sobol told reporters.

A spokesman for Gazprombank on Tuesday declined to comment further on Mosenergo.