May 27
Private equity as an industry is now reaching “middle age”. By that, I mean it is somewhere around 40 years old, having been born in the early 1970’s. There was a frustrating article in the Economist recently which suggested, it’s becoming dull and boring – no longer truly worthy of its status as an “alternative” asset class. I beg to differ. continue reading
Tom Stabile in Sunday’s Financial Times raises the conundrum of how smaller more niche investors, like VIY Management, attain the support of large investors who want to invest in non-traditional emerging funds, but are often discouraged by the time and financial costs involved.
In 2007 a ‘bombshell’ hit the well established European tourism market: Alexey Mordashov of Severstal, a Newcastle University MBA alumnus, bucked the trend and invested in a leading European tour operator TUI AG. Over time Mr Mordashov’s G-Groupe became the largest shareholder of the GBP 5.0 billion tourism behemoth. He hasn’t done badly – at least doubling his investment over the last 6 years. continue reading
Reuters and Russian financial paper, RBK Daily, report that Goldman Sachs is “bucking” the trend by continuing to recognise the investment opportunities available in Russia. I have already blogged about Goldman Sachs making “bitesize” investments in Russia in recent years, and this was confirmed once again with yesterday’s announcement that the European investment branch bought a 6% stake in the Russian company O1 Properties. continue reading
“Russia remains a land of opportunity for investors” reads the title of a comment piece in Tuesday’s Financial Times. It surmises many of the opinions I have already discussed on my blog about the misconceptions of the Russian investment climate. The author, Chris Weafer, has long been on the side of Russian investment and I would encourage you to read his contributions to the blog Russia other points of view to see how he is fighting to promote a more positive perception of Russia. continue reading
This week’s edition of Global Capital made me smile. At a time when the media is focused on the widespread reticence for doing deals with Russia, this article shows banks are always prepared and always willing to make money from any situation! Apparently the West hasn’t done a deal with the “wobbly” Russian bond market for over a month. Yet VimpelCom, Russia’s third largest phone company, has just received a credit facility worth almost $1.8bn from several international banks. The media should report more on how companies are bucking the trend!
The recently published Fitch ratings highlight the exposure of European banks to events in Ukraine. According to the Bank of International Settlements, foreign banks are currently investing a total of USD242 billion in Russia; 76% of this investment is from European banks, with only 16% from American banks, and 7% from Asian banks.
Mar 11
Last Wednesday the Russian food retailer Lenta started trading on the main market of the London Stock Exchange. This was the first time in over a year that a Russian organisation has been listed in the UK. Despite ongoing events in Ukraine and a falling rouble, the hypermarket giant raised $952 million through offering global depository receipts, equating to a 22.1% stake in the company.
You will not grasp her with your mind
Or cover with a common label,
For Russia is one of a kind —
Believe in her, if you are able…
Fyodor Tyutchev[i]
It has only been a fortnight since the Sochi Olympics kicked off with an intriguing opening ceremony that will go down in history, not only for its sense of style and obvious pride for the host country, but also for a technical glitch that left the iconic Olympic symbol with one ring short. I was positively surprised how the organizers were able to adapt the closing ceremony’s script to reflect on this technical malfunction during the opening ceremony. continue reading
Another company competing for investments in Russia, Elbrus Capital, announced last week it has been successful in raising $550 million for one of its funds. This fund in fact exceeded its initial target by 10%. With current market speculation, this successful completion in fundraising illustrates investors continue to have confidence in the opportunities in Russia and the CIS.
Andrey Yakunin