Russia's Prof-Media, the media vehicle of metals tycoon Vladimir Potanin, said on Monday it had bought MTV Russia and VH1 Russia for about $360 million cash to expand its reach in free-to-air entertainment broadcasting.

U.S. media conglomerate Viacom Inc. (VIA) owns 53 percent of the company that controls the channels, while 42 percent is owned by private equity firm Russia Partners and 5 percent by the European Bank for Reconstruction and Development.

MTV, which launched in Russia in 1998 a year after Prof-Media was established, said it would continue to grant an exclusive licence for MTV and VH1 programmes and related Web sites in Russia.

MTV Networks Vice-Chairman Bill Roedy said the deal would enhance MTV's reach in Russia as it moved from a financial partnership with the likes of Russia Partners to a strategic relationship with Prof-Media.

"When you have that sort of media company, that partnership gives us a much bigger scale and presence in the market. As Russia has quickly become more sophisticated, more complicated and even more competitive, this will help the business immeasurably," Roedy told Reuters.

Roedy said the financial return on the company's investment was "very attractive" but declined to provide specific details.

Prof-Media is Russia's largest privately-owned media group with interests spanning cinemas, film production and distribution, radio, television, magazines and the Internet.

Its acquisitions in the past year included Rambler Media, the British-registered owner of Russia's Rambler Internet portal, entertainment channel TV-3 and 2X2 TV, Russia's first free-to-view animation channel.

"The MTV Russia acquisition is very complementary to our existing operations and exposes us to a new segment of the young and proactive audience, which is heavily in demand from top advertisers," said Prof-Media CEO Rafael Akopov in a statement.

MTV Russia broadcasts to 35 million TV households via a network of 21 owned and operated stations and around 650 affiliates as well as cable and satellite operators. VH1 is available in 14 million homes primarily via cable operators.

Renaissance Capital acted as financial advisor to Russia Partners.