Magnit

Related Party Transaction • Aug 25, 2015

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PJSC MAGNIT - Execution of the Related Party Transaction

PR Newswire

London, August 25

Press-release

Krasnodar

August 25, 2015

PJSC “Magnit” Announces the Execution of the Related Party Transaction

Krasnodar, August 25, 2015: PJSC “Magnit”, Russia’s largest food retailer (the “Company”, the “Issuer”; MOEX and LSE: MGNT), announces the execution of the transaction on August 25, 2015.

Type of transaction: related party transaction; material transaction which is not major.
Subject of transaction: Provision by the Issuer of the guarantee under the General agreement # 42-0-10/2-2015 on the procedure of the credit agreements conclusion (hereinafter – “the Credit agreement”) executed between Open joint-stock company “Russian Agricultural Bank” (hereinafter – “the Creditor”) and JSC “Tander” (hereinafter – “the Borrower”) on August 25, 2015.
Content of transaction:
In accordance with the guarantee agreement, the Guarantor shall be jointly liable to the Creditor for the proper fulfillment of obligations of the Borrower under the Credit agreement executed on the following essentials: - the Creditor shall provide the Borrower with the monetary funds in Russian rubles; - the total credit limit under the Credit agreement (the credit amount which may be granted under the Credit agreement) shall not exceed 10,000,000,000 (Ten billion) rubles; - the maximum term of the individual credit granted under the Credit agreement shall not exceed 60 (Sixty) calendar days from the date of the credit provision; - the interest rate for the use of the credits granted under the Credit agreement including charges - not more than 30 (Thirty) percent per annum; - the term of the Credit agreement – until December 4, 2015; - conditions, procedure of granting and repayment of the credit, interest and other payments are determined by the Credit agreement; - the Guarantor shall be fully liable to the Creditor for non-fulfillment or improper fulfillment of obligations by the Borrower under the Credit agreement, including principal amount of debt, interest, penalties, losses caused to the Creditor by the non-fulfillment or improper fulfillment of the Credit agreement; - the Borrower shall incur the following liability under the Credit agreement: in case if any payment under the credit is not received by the Creditor within the terms agreed by the Creditor and the Borrower when concluding the credit transaction within the Agreement, including obligations for the credit repayment (principal debt), the Borrower shall pay the penalty to the Creditor for non-fulfillment of obligations by the Borrower for payments in Russian rubles in the amount of 1/365 or 1/366 (depending on the actual number of days of the year) of the dual key rate of the Bank of Russia, effective at the moment of delay, of the amount of outstanding obligations per calendar day of the delay. The Guarantee agreement shall secure the fulfillment of obligations by the Borrower in case of invalidity or loss of the Credit agreement fixed by the valid judgment on repayment of monetary funds under the Credit agreement received by the Borrower for the benefit of the Creditor and on the payment of interest for the use of other monetary funds charged on the amount of unreasonable gains of the Borrower.
Deadline for the fulfillment of the obligation: The Agreement shall be applicable for the whole amount of Credits under the Credit agreement which may be provided to the Borrower by the Creditor according to the Credit agreement, for the period not less than the period of validity of the Credit agreement, increased by 180 (One hundred and eighty) calendar days. In case if the Credit agreement / credit transaction are declared invalid / not executed, the guarantee terminates if the Creditor does not submit a claim to the Guarantor under the Credit agreement within a year from the date on which the Credit agreement / credit transaction are declared invalid / not executed.
Parties and beneficiaries under transaction: The creditor - Open joint-stock company “Russian Agricultural Bank” The guarantor – Public Joint Stock Company “Magnit” The borrower (beneficiary) – Joint Stock Company “Tander”
The amount of the transaction in the monetary value and as a % of the asset value of the issuer: 10,830,136,986.00 rubles which amounts to 11.3509% of the balance sheet assets of the issuer.
Asset value of the issuer as of the closing date of the accounting period preceding the execution of the transaction: 95,412,330 thousand rubles
Date of the transaction execution: August 25, 2015
Information on the approval of the transaction: The transaction was approved by the annual General Shareholders Meeting of June 4, 2015 (the minutes of the annual General Shareholders Meeting of PJSC “Magnit” w/o # of June 5, 2015)

For further information, please contact:

Timothy Post	Director, Investor Relations Email: post@magnit.ru Office: +7-861-277-4554 x 17600 Mobile: +7-961-511-7678 Direct Line: +7-861-277-4562
Dina Svishcheva	Deputy Director, Investor Relations Email: Chistyak@magnit.ru Office: +7-861-277-4554 x 15101 Mobile: +7-961-511-0202 Direct Line: +7-861-277-4562
Media Inquiries	PR and GR Department press@magnit.ru

Company description:

Magnit is Russia's largest food retailer. Founded in 1994, the company is headquartered in the southern Russian city of Krasnodar. As of June 30, 2015, Magnit operated 29 distribution centers and over 10,700 stores (8,890 convenience, 311 hypermarkets, and 1,527 drogerie stores) in approximately 2,233 cities and towns throughout 7 federal regions of the Russian Federation.

In accordance with the unaudited IFRS management accounts for 1H 2015, Magnit had revenues of RUB 455 billion and an EBITDA of RUB 49 billion. Magnit's local shares are traded on the Moscow Stock Exchange (MOEX: MGNT) and its GDRs on the London Stock Exchange (LSE: MGNT) and it has a credit rating from Standard & Poor's of BB+. Measured by market capitalization, Magnit is one of the largest retailers in Europe.