Russian Businessman Intends to Buy German Karstadt

Russian businessman Arthur Pakhomov the owner of the holding Karoteks has made an offer to buy the bankrupt German chain of malls Karstadt, said on Saturday the magazine Der Spiegel. Pakhomov proposed for the entire company about 40-60 million Euro. 

Representative of the external administration of Karstadt reported that the network has four potential buyers, but refused to name them. "We received a letter and sent it for inspection to investment bank", - he said.
Der Spiegel, without naming its sources, reported that Pakhomov plans to finance the Christmas sales season of Karstadt in 2010, as well as invest 80 million Euro a year to develop and maintain its long-term stability.

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Russia and Kazakhstan Customs Union

Russia and Kazakhstan will form a customs union by July 1, 2010. Minsk was not ready to join on the terms proposed by the two countries. 

Partners have put up with the lack of Minsk, and have agreed on all issues in a bilateral format and in the evening they announced the successful completion of negotiations:

"We have agreed on a bilateral basis the Customs Code of the Customs Union", - Putin said at a press conference. "We are open to the accession of Belarus to all agreements and decisions taken by us," - he said.

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Russian Severstal Aquired Canadian High River Gold

One of the largest steel companies of Russia Severstal has increased its share in the Canadian High River Gold to 68.88 per cent. 

Severstal, controlled by its General Director Alexei Mordashov, has acquired 18.76 per cent stake in Canadian company from Troika Dialog, said High River.

"The deal was made at a price close to market", - said the representative of the resource unit of Severstal on Friday.
Based on the current capitalization of High River 18,76 per cent of its shares are worth about $ 114 million.

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Russian Economy Grows Faster Than the European Economy

UN raised the forecast of GDP growth in Russia. According to experts of the organization in 2010 Russia's economy will grow by 4,3%, and in 2011 - by 3%. In January, the UN predicted that the growth of Russian GDP in the current year will amount to 2,8%.

It should be noted that earlier that same day, 26 May, the forecast for global economic growth in 2010 increased and the Organization for Economic Cooperation and Development (OECD) - with 3,4% to 4,6%, while Russia's GDP growth was also revised upward - from 4,9% to 5,5%.

Most analysts said that Russia will be a key factor in boosting the recovery in consumer demand and energy prices. Revised forecast of Russia's GDP is related not only to higher prices for raw materials, which was particularly noticeable at the beginning of the year, but with recent macroeconomic data.

According to experts, the costs of the State are no longer increasing, and the anti-crisis support is remained in the past. Domestic demand began to grow. This is shown by the data on import. The export is also recovering steadily since the end of last year, although it is clear that the comparison is still performed with weak months of 2009.

Uralkali is For Sale

The owner of Russian fertilizer producer Uralkali Dmitry Rybolovlev is in talks to sell his stake of 65 per cent of the company, said the Chairman of Audit Committee on Thursday.


According to the company, the discussion is at an early stage, conditions and structure of a possible transaction, as well as the probability of its conclusion, are still unclear.

Norilsk Nikel Divedends

Norilsk Nickel, the world's largest producer of nickel and palladium producer, is planning to send more than half of its profits, or $ 1.325 billion in dividends for 2009, told the General Director Vladimir Strzhalkovsky.

Gazprom Increases Dividends by 6,6 Times

The Board of Directors of OAO "Gazprom" recommended to shareholders to pay dividends for 2009 at a rate of 2.39 rubles per share, reported the information department of the company.

Thus, among the shareholders of the largest gas company in the world there will be distributed 17.5% of net profits of the company for last year (minus the "paper profits"), as recommended the management of Gazprom.

If approved, the dividend will increase by 6,6 times compared with a similar scheme on the basis of 2008. Then, in the midst of crisis, Gazprom decided to apportion among its shareholders only 5% of the profits.

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Gazprom Neft IPO

Gazprom Neft announced today that it is considering various options for the development of oilfield services business units. In particular, the company contemplates an initial public offering (IPO) or sale of shares Gazpromneft-Nefteservice. "

The process the company plans to complete within a year. Exclusive advisor on the potential transaction is Deutsche Bank.

Oil service unit of Gazprom Neft is a management company (Gazpromneft-Nefteservice ") and nine subsidiaries. Together they offer a wide range of specialized services in the field of drilling, overhaul and maintenance of wells, Geophysics, cementing, transport services, as well as repair services and maintenance of drilling and ancillary equipment, nasosnokompressornyh and casing.

The activities of enterprises Gazpromneft-Oilfield "concentrated in key oil-producing regions of Russia: Yamalo-Nenets and Khanty-Mansi Autonomous Areas, Tomsk and Omsk regions, Yakutia and Krasnoyarsk.

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Novatek's Profit Shifted Expectations

Novatek's net profit rose fivefold in the first quarter of 2010 due to increased demand for gas, foreign exchange gain and sale of Terneftegaz. 

The second-largest gas producer in Russia said on Friday that the company had received in the first quarter 11.2 billion rubles of profit against 2.1 billion a year earlier. Analysts expected the profit of Novatek to be only 9.6 billion. 

Total revenues increased by 63,4 percent to 27,7 billion rubles, last year it was 17 billion. Experts predicted that this figure will be 28 billion rubles. 

"Recovering of domestic demand, seasonal factors and rising prices have contributed to steady growth of financial indicators in the first quarter of 2010" - said Novatek with reference to its financial director Mark Dzhetveya.
Novatek's shares on MICEX fell by 0.89 percent , securities of the company on the London Stock Exchange have fallen in price to 2,03 percent.

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Russia's GDP Growth in 2010

Russia's GDP grew in the first quarter of 2010 in annual terms by 2,9 per cent, said a preliminary assessment of Russian Statistics. 

According to the Federal State Statistics Service Russia's GDP has shown positive trend in annual terms last time in the third quarter of 2008, adding 6.6 percent to the third quarter of 2007, while in the fourth quarter of its pre-crisis 2008 was marked by the zero dynamics to the fourth quarter of 2007 .

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IPO of Koks - Russia's Largest Producer of Coke

JSC Koks is one of Russia's largest producers of metallurgical coke, again returned to the plans of IPO in fall this year, said sources on the financial market. The organizers of the IPO will be UBS, Citi and VTB Capital.

Some sources said that the company is focused on attracting about $ 400 million, but by fall the amount can be adjusted depending on market conditions.

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IPO of RZD's Subsidiary "Transcontainer"

Container subsidiary of RZD Transcontainer will start road-show of public offering of 35 per cent of shares in October- November 2010, said a representative of the company's management. The Board of Directors of the railway monopoly approved the sale of shares in April 2010.
 

Transcontainer may cost $ 1,7-2,1 bln, 35 per cent of the shares are worth $ 595-735 million. Shares of Transcontainer will be placed in London and in Russia, banks-organizers have not yet been appointed. In 2008 RZD sold through private placement 15 percent of Transcontainer and remained a controlling stake of 50 per cent plus one share. 

Transcontainer is a transportation company specializing in container transport logistics. Currently 84.9 per cent of stake belong to RZD, 9.2 per cent - to the European Bank of Reconstruction and Development (EBRD), the rest belong to Russian and foreign investment funds. 

Revenue of Transcontainer IFRS in 2008 grew by 53 per cent to 20.5 billion rubles, net profit - 85 per cent to 3.57 billion rubles.

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Growth of RZD Rates For Rail Freight in 2011

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The maximum growth of rates for rail freight in 2011 may reach 14%, according to the head of Russian Railways (RZD) Vladimir Yakunin. However, if the government continues to subsidize the rail giant, prices will be slightly smaller, he said. 

"The growth of rates without a subsidy will constitute 14%. If the State retains subsidy of tariff rates it will be 9.2%", - said Vladimir Yakunin. He clarified that the proposal to raise the rates comes from RZD.

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Wal-Mart Intends to Buy Russian Lenta Stores

One of the world's largest retailers - the American company Wal-Mart Stores Inc. intends to acquire 100% stake in the Russian grocery retailer Lenta. It is reported that currently the company has conducted preliminary discussions on this issue. 

According to sources close to the negotiations the official conclusion of the transaction may take from several months to a year. It is also reported that the consultant of Wal-Mart in the negotiations is a Swiss bank Credit Suisse. Formal negotiations on the management level of U.S. and Russian companies have not yet begun. The amount of possible transaction is also not reported.  

The company "Lenta" was founded in 1993. The founder of LLC "Lenta" is Lenta Ltd., Registered in the British Virgin Islands. Head office of the Russian company is located in St. Petersburg. There are 36 stores of the network in Russia, including 14 in St. Petersburg. Sales of Lenta rose by 9% over the previous year and reached 55 billion 600 million rubles in 2009.  

Wal-Mart is the world's largest retail chain, which includes more than 7 thousand stores in 14 countries (4,1 thousand in the U.S. and the rest - in Argentina, Brazil, Canada, China, Costa Rica, El Salvador, Guatemala, Honduras , Japan, Mexico, Nicaragua, Puerto Rico, UK, India). Among the stores there are  hypermarkets and supermarkets that sell food and industrial goods. Total staff of the company is 2.1 million people (of which 1.4 million are in the U.S.).

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Mechel IPO on NYSE

Mechel has completed placement of preferred shares on the New York Stock Exchange (NYSE). At 00:46 Moscow time the value of securities amounted to $ 7.90, which is 5.33% higher than at the beginning of trading. 

On May 7 it was reported that the shareholders of Mechel attracted U.S. $ 228.75 million through public offering of preferred shares. Selling shareholders agreed to sell 30.5 million ADS, issued to 15,250 million of preferred shares. The price of one ADS was U.S. $ 7,5.

Preference shares and preferred ADS are offered by James Justice II, James Justice III, James C. Justice Companies Inc. and Gillian L. Justice. Selling shareholders offered bookrunners an option to buy additional 4.5 million ADS preferred within 30 days, if necessary, the company said.


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PMI Indicator Showed Growth of Russian Economy in April

GDP of Russia calculated by VTB Capital Research, said that Russian economy continued to grow in April 2010 by 1.2 percent after a revised 0.3 percent growth in March 2010.

Total Activity Index was 56.6 points, remaining above the mark of 50.0 points separating recession and growth. "We expect that stabilization of the employment situation in the future will ensure faster economic growth through increased consumption", - said analytics.
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RGI Invests &150 mln in Construction in Moscow

Developer RGI International believed in the speedy restoration of residential real estate market in Russia and plans to invest about $ 150 million in the construction of the first residential complex of economy class in Moscow in 2010-2011, CEO Emanuel Kuzinets reported in the interview.

The company plans to spend about $ 1.3 billion over 7-8 years, said Kuzinets. The company expects to receive $ 900 million of net profit. 

Israeli RGI has traditionally specialized in the implementation of elite residential and office property in Russia, but under the impact of the crisis has decided to adjust its strategy and concentrate on segment of mass housing. The first dwelling - three houses with a total area of over 90.000 square meters - the company promises to start in the second half of 2010.

"We will need debt financing to start construction - about $ 50-70 million ... If we can pre-sale by reinvesting part of the profit from the introduction of the first stage in implementing the second phase and so on, we do not need substantial credit facilities," - said Kuzinets .

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USA Atomic Energy Contracts With Russia

The State Corporation Rosatom has signed with U.S. companies long-term contracts in the field of atomic energy - Sergei Kiriyenko, the head of Rosatom claimed during a meeting with the Prime Minister Vladimir Putin.

"Remember how long we fought for it to overcome the anti-dumping procedures. I reported - in the past year, we overcame it. In the beginning of this year we signed contracts for 4.2 billion dollars until 2014. We have fully contracted deliveries to the U.S. market. Now we can confidently say that we have entered contracts until 2020. " - said Sergei Kiriyenko.

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Banka Intensa in Russia

The largest Italian financial group Intesa Sanpaolo came to Russia in early seventies when their first representative office had been opened in Moscow. 

Today, thanks to the work of the Moscow office and Banca Intesa, the Russian subsidiary bank of the group, Intesa Sanpaolo is now represented in 25 Russian regions. In 2010 Banka Intesa merged with a bank that has been working in the Urals for a long time - KMB BANK, a trend setter in terms of working with small and medium sized business. 

The reorganisation has been a part of the strategic plan for  development of the group's presence in Russia. Intesa Sanpaolo is the bank that owns the controlling interest in Banca Intesa (86.75%), is one of the largest in Europe, and serves more than 19.4 million clients in 40 countries.

Prior to 2010 there were two subsidiary companies in Russia - CJSC Banca Intesa serving medium-sized and large companies and KMB BANK specialised in lending to small and medium-sized companies. The reorganisation enables  to use the experience of both of them for the establishment of one strong bank experienced in different segments of the market.  

Banca Intesa is already assuming serious positions in the financial services market in the Urals Federal District. Russia's largest companies which constitute the real sector of the country's economy are located here. The Urals is the most important source of the budget money in Russia, it has huge raw materials reserves, here we see the state of the art technologies implemented, and the region demonstrates good economic indicators. This region is extremely interesting for Banca Intesa. 

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Russia Wants to Merge Gazprom and Naftogaz of Ukrain

Russia has offered to Ukraine to create a single company on the basis of Gazprom and Naftogaz through the exchange of shares between the largest by market capitalization in Russia and much inferior to it by the size of Ukrainian gas monopoly.
 

"We talked about integration in the nuclear field. We offer the same thing done in the gas sphere. I propose to merge Gazprom and NAK of Ukraine", - said the Prime Minister Vladimir Putin , who incidentally promised Ukraine $ 500 million loan from the Russian State Bank VTB . 

Ukraine called these proposed merge "Putin's offhand", but promised to think about it.

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