Kremlin extends media grip through Gazprom deal

* Tycoon sells media interests to Gazprom Media

* Putin's banker has indirect interest

* Media experts see threat to diversity

By Denis Dyomkin and Douglas Busvine

MOSCOW, Nov 26 (Reuters) - The Kremlin extended its grip over radio and television broadcasting on Tuesday when the media arm of state-controlled Gazprom bought mining tycoon Vladimir Potanin's Profmedia.

Through the deal, the former Soviet gas ministry that is now Russia's largest company by revenue, will add TV and radio stations, cinemas and film production and distribution assets to a sprawling portfolio that it has built up around commercial television channel NTV.

Gazprom Media and Interros, Potanin's investment company, said the deal should be completed at the start of 2014, subject to regulatory approvals.

The terms were not disclosed. Itar Tass news agency quoted a source close to the deal as saying that it valued Profmedia at 25 billion roubles ($760 million). After subtracting debt, that would give the company an equity value of 15 billion roubles.

"There is nothing good in the fact that we are seeing the concentration of assets in one hand," said Elizaveta Osetinskaya, editor in chief of Forbes Russia, a magazine known for investigative journalism.

"Seven TV channels and sales of 70 billion roubles? It looks a lot like Mediaset," added Osetinskaya, drawing comparisons with the media empire owned by former Italian Prime Minister Silvio Berlusconi.

Who ultimately controls Gazprom Media is not entirely clear, but its board of directors is chaired by Gazprom's chief executive, Alexei Miller. President Vladimir Putin hand-picked Miller to run Russia's gas export monopoly in his first term.

Gazprom owns a 35 percent direct stake in Gazprombank, which in turn owns 100 percent of Gazprom Media.

Its pension fund, Gazfond, owns another 47.4 percent in Gazprombank. Most of this stake has been entrusted to an asset manager called Leader. One of Leader's shareholders is a firm owned by banker Yuri Kovalchuk, a close friend of Putin.

ARM'S LENGTH?

Although the state gas giant operates at arm's length to the Kremlin, Putin has repeatedly used its control over gas exports to project Russia's power abroad.

Gazprom bought NTV in 2000 from Vladimir Gusinsky, an exiled media tycoon who became the first prominent victim of a crackdown on coverage critical of the Kremlin after Putin rose to the presidency.

That purchase marked a step towards entrenching the power of the former KGB spy, who served briefly as prime minister before being designated by the ailing Boris Yeltsin as his presidential heir.

Despite criticism from investors that it was straying from its core business, Gazprom has expanded its media interests, which has kept broadcast, online and print outlets in politically safe hands.

Under Gazprom's ownership, NTV quickly shed its previous reputation for fierce independence. In the 2011-2012 election season, it ran a series of documentaries that sought to discredit Putin's political opponents.

Gazprom Media also owns satellite TV company NTV-Plus, and its radio assets include all-talk station Ekho Moskvy. It has interests in magazines, newspapers, film-making, cinemas, advertising sales and online portals.

The media firm posted revenues of 52.3 billion roubles ($1.6 billion) in 2012, roughly one hundredth of Gazprom's total sales.

Putin's former minister for press and mass communications, Mikhail Lesin, was recently appointed to run Gazprom Media.

"With the arrival of Mikhail Lesin, the media landscape is starting to be shut down," wrote Arina Borodina, a columnist for state-owned news agency RIA Novosti.

Borodina also noted that Kovalchuk, in addition to his indirect stake in Gazprombank, has extensive media interests of his own. His National Media Group owns three Russian TV channels and national newspaper Izvestia.