We are calling by name those who will get all our money.

 

It is known that VEB (Foreign Economic Activities Bank) is planning to grant $50 bn to Russian companies with the purpose of paying off foreign debts. The list of claimants is known. We decided to make you acquainted with those who are going to get our money and to tell who owes how much and what they had been spending their money on till the kibosh came to Russia. The pointed amounts, ready to be granted by the VEB, are preliminary, and it is only most interesting assets to be mentioned.

 

 

Company’s name: UC Rusal; Company’s official: Oleg Deripaska

 

Debts: foreign debt by UC Rusal is $14 bn, out of which $4.5 bn are credits taken for purchasing a quarter of stock of Nornikel.

 

How much is asked for: UC Rusal intends to pay off over $3 bn, using the public funds.

 

Previous spending: in March 2008 Rusal acquired a cathode-producing plant “Baoguan” in China; in April 2008, 25% of the Nornikel stock plus 1 share was bought; in 2006 bought was 100% of the state-belonging stock of a boxite-alumina complex in Guinea.

 

 

Company’s name: Nornikel; Company’s official: Vladimir Potanin

 

Debts: Nornikel has a debt under a syndicated credit of $400 that is to be paid off in November.

 

How much is asked for: Probably, Nornikel is hoping to pay off the full amount using the means granted by the VEB.

 

Previous spending: In 2008 Nornikel acquired 8.7% of its own stock for $2 bn. In 2007 it purchased a nickel business from OM Group, Inc.; nickel-processing plant in Harjavalta in Finland; the enterprise, named Cawse, for extraction and processing the nickel ore in Australia.

 

 

Company’s name: Rosneft; Company’s official: Igor Sechin

 

Debts:  the company has to pay off about $800,000,000 to foreign banks, before the end of this year.

 

How much is asked for: According to one of the company’s managers, Rosneft is seeking for a credit of $800 millions from the VEB. The media sources allege that in general it plans to get $4.2 bn from the state.

 

Previous spending: First of all, Rosneft is known for purchasing the assets of the forcefully bankrupted YUKOS, which took over $28 bn (proceeding from the average currency exchange rate of 25 rubles per 1 dollar).

 

 

Company’s name: PIK; Company’s officials: Yuri Jukov, Kirill Pisarev

 

Debts: According to its financial statement, in June PIK was given 3 foreign credits in the amount of $350 millions (all of them must have been paid off by 2-3 October 2008).

 

How much is asked for: Not known yet.

 

Previous spending: acquiring of the plants of JBI, steads, also regional building companies.

 

 

Company’s name: Alpha Group, Vympelkom; Company’s officials: Mikhail Friedman, Alexander Izosimov

 

Debts: In 2007, the holding company Altimo, belonging to Alpha Group that possesses 44% of the Vympelkom stock, pledged this package on two loans for the amount of 2$ bn. Now Alpha Group owes this money to Deutsche Bank.

 

How much is asked for: Vympelkom is counting to pay off its debt to Deutsche Bank using the funds from the VEB.

 

Previous spending: In October 2008 Vympelkom purchased 90% of the stock of Sotelco in Cambodia. In 2006 Vympelkom reported about purchase of 60% of the OOO Takom, the Tajikistan-based cellular operator. The amount of
the deal came up to $12 millions.

 

 

Company’s name: Gazprom; Company’s officials: Alexei Miller (President), Viktor Zubkov (chair of board of directors)

 

Debts: Gazprom has short-term debts for the amount of $20.5 bn.

 

How much is asked for: Gazprom has applied for a credit of approx. $1 bn from the VEB.

 

Previous spending: By 2007, Gazprom and the Byelorussian Property State Committee signed a purchase contract for OAO Beltransgaz, according to which Gazprom acquires 50% of the Beltransgaz stock for $2.5 bn. The purchase is to be paid in installments of 12.5 % up to 2010. In 2006 Gazprom purchased 50% of the Sakhalin Energy’s stock, which cost it $7.45 bn.

 

 

Company’s name: LUKOIL; Company’s official: Vagit Alekperov

 

Debts: The short-term bill payable by LUKOIL for the first half of 2007 is about $6.4 bn.

 

How much is asked for: LUKOIL requests that the VEB gives it a credit for $2 bn.

 

Previous spending: In 2008 LUKOIL acquired a plant in Italy for €1.8 bn; also it signed a purchase contract for a Turkish Company Akpet. In 2007 it bought a retail business of an American Company, Conoco Phillips. At the end of 2006 LUKOIL bought 376 filling stations from same company.

 

 

Company’s name: TNK-BP; Company’s official: Viktor Vekselberg

 

Debt: according to financial statement for 2007, the net debt of TNK BP has increased up to $5.4 bn.

 

How much is asked for: TNK BP is counting on a credit of $1.8 bn.

 

Previous spending: In 2007 TNK BP purchased two alike-named companies ¬ OOO Yugansk-Nafta and OOO Nafta-Yugansk that hold licenses for 12 places in Khanty-Mansiysk autonomous territory in the Tyumen region.

 

 

Comments

 

Elena Anankina, credit analyst at Standard & Poor’s:

 

If we talk of the home petroleum companies the word “effective” is not applicable, to my mind. Nonetheless, our oil companies look more reliable than corporations from other spheres.

 

Besides, one should take a closer look at what part of the debt by the oil companies is short termed. In case we do it, we shall see they do not have many short-term debts and so the things are not standing too badly. So, basically the oil branch is applying to the VEB just to be on the safe side.

 

Olga Samarez, analyst at the investment company “Prospect”:

 

Support given by the state to the domestic network retail is justified. In case the networks develop serious problems with payments to their suppliers, then the assortment sold would become poor and our shops would have empty shelves, which every one is afraid of.

 

Anton Tabakh, senior analyst at IK Troika-Dialog:

 

The motivation differs by those counting for VEB money. Say, out of 4 petroleum companies applied only Rosneft has real problems. However, even gambling-dealing companies have asked for money. Many take the actions by the government as distributing the “gratuitous elephants”, and so they apply on the chance. At the moment, there are no holes in the VEB plan that could allow the companies that really are not in trouble to get a credit anyway. However, it should be considered that we are living in Russia…

 

Igor Berezin, President of Marketers Guild:

 

Retail trade is one of few areas where it is still possible to avoid lowering the indicators. Relying on the consumer’s market, we can begin to solve gradually the economic problems. While before the raw materials and investments were our priorities, now we should go for retail.

 

Our state will always find a billion for a billionaire, and will refuse to give a penny to a pauper.

 

It is not known for sure who had asked for the builders, but the money for purchasing the flats for militaries and other socially significant categories have been allotted by Prime Minister Putin in person, that’s $50 bn. This is more than was promised by the regional authorities, the mayor of Moscow Yuri Luzhkov, for example, who promised to give $2 bn to developers.

 

The real sector wants money from Igor Sechin who is trying to decide how to divide the coming-to-save Fund among metallurgists, car-producing industry and others. Interestingly, Sechin himself asks for money from the VEB for re-crediting of Rosneft that he heads. In this case, his request differs from an order only in a formal way. As for the rest of debtors, they must ask for money from him, and do it seriously.

 

Very peculiar looks the request by the deputy Prime Minister Sergei Ivanov who demands for money to be given to the air carriers so that they are able to pay for the kerosene. It’s peculiar not because the air carriers are getting bankrupt one by one within the framework of creation of the state-run holding Avialinii Rossii (Russia’s airlines), but because the Prosecutor General’s office and Federal Antimonopolist Agency have found grave violations of the law related to the process of pricing for that kerosene. It looks like Sergei Ivanov suggests paying off the debt to the frauds, after which we are supposed to feel better!

 

In the meantime, common people are not registered among those asking for money. They have no powers like those given to parliament, president or someone else. They got additional financing only in good years, and anyway that was done within the framework of the election campaigns and other “national projects”. Now, with the elections being over, the state has already shared out the money.

 

Yes, all the levels of authority - from president to prime minister and then in transit to the government, governors, and down to municipalities - all of them say they would not give up the assumed social responsibilities.

 

Well, that sounds nice, however, those responsibilities were taken upon during the period of stable growth, and now we are facing a crisis. No one is speaking about any special anti-crisis program intended for the wider strata of society. Take mortgage debtors, for example. It’s clear they took some risks, but they risked no more than the banks or builders did. Then why banks and builders can get money, while their clients cannot? The situation about the retail networks is even stranger. Why do they have to receive money without taking obligations to reduce prices? Let them sell the goods from the “pensioner’s basket” without price markup, and then let them sell the other products being credited from the public funds. By the way, the largest networks in Japan have reduced their prices for imported goods for 30%, while ours affirm they cannot afford it as they would get ruined.

 

The picture may seem to be utopian. However, the western governments have taken similar obligations upon. For example, the US government promises tax remissions for the citizens so that they can make payments for their mortgage credits. And Europeans guarantee the payment of 100% of deposits of physical persons, whatever it cost.

 

And our state is featured with the fact it will always find a billion for a billionaire and will refuse to give a penny to a pauper. Is it because the kickback must be arranged individually with every applicant? Or maybe it is because major part of applicants is not strangers to those distributing the money? Well, one’s own assets are always closer to the sources of funding.

 

 

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Source: Novaya Gazeta