Sistema shares surge 15% on Sep 5 following Putin's statement

The rally was triggered by the President of Russia’s expressly stated expectations of an amicable agreement between Sistema and Rosneft.
Sistema’s stock price on Moscow Exchange soared on the back of Russian President Vladimir Putin’s statement that he expects an amicable agreement to be concluded between Sistema and Rosneft in a case worth RUB 170.6 billion.
In the first half hour of trading on Moscow Exchange, Sistema’s securities went up almost two rubles in value from the opening price of RUB 12.545 per share on September 5. Sistema’s peak price on MOEX reached RUB 14.45 on Tuesday, approximately 15.2% above the closing price in the previous trading session.
Rosneft shares saw a modest price growth on Tuesday with a peak at RUB 305.2 per share (approximately 0.86% above the closing price in the previous trading session), followed by a slight decline.
At 11:20 MSK, Sistema shares traded at RUB 13.435 on MOEX (7.09% above the closing price on the previous trading day), while each Rosneft share was valued at RUB 303 (+0.13%).
The powerful growth of Sistema’s share price and the simultaneous Rosneft stock price depreciation began after an RBC reporter asked the President to comment on the dispute between Sistema and Rosneft at a press conference in China.
“I met with the chief executives of Rosneft and Sistema, both with Evtushenkov and Sechin. My meetings with them addressed precisely this issue. I listened to both sides. I think it would be wrong if I publicly stated my position in this case, but I am hopeful they will be able to settle the dispute amicably – which I believe would be good to both companies and the Russian economy as a whole,” Putin said.
However, the President noted that he could not say with 100% certainty how things would develop as no direct instructions had been given to anybody in this respect.

Commenting on opportunities for an amicable agreement with Sistema, Rosneft Press Secretary Mikhail Leontyev told RBC that Sistema had never approached the oil producer to negotiate the terms of such an agreement.
“So far, they’ve only been talking bunkum and mocking the judicial system,” Leontyev said adding that this was his personal opinion.
On August 23, the Arbitration Court of Bashkortostan sustained Rosneft’s claim against Sistema in a dispute on the validity of the restructuring of Bashneft in 2014 – although the amount of compensation sought by the claimant was reduced to RUB 136.3 billion.
On September 4, Rosneft Chief Executive Igor Sechin promised to review “the arguments which the judge took into consideration when reducing the claim amount to RUB 136 billion.”
By: Yevgeny Kalyukov
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