INTERVIEW: DOM.RF to get Sviaz-Bank’s real estate assets

MOSCOW, Jun 14 (PRIME) -- Most bad assets of Sviaz-Bank, a subsidiary of Russia’s state development bank VEB.RF, are real estate property, they will be transferred under control of national housing development institution DOM.RF, and the remaining bad assets will be sold, VEB.RF First Deputy CEO Mikhail Kuzovlev said in an interview with PRIME, released on Friday.

Sviaz-Bank is to be transferred to Promsvyazbank, a new government bank to handle defense order contracts in the conditions of Western sanctions, without bad assets.

“Most of (the assets) are real estate that will be moved under control of DOM.RF. The rest will be sent to VEB.RF and their future will be decided. There are around 30 of the items, we will advertise them, and then sell,” he said.

Three companies, willing to acquire turkey producer Eurodon from VEB.RF, will submit their bids until the end of June, Kuzovlev also said.

“The deal is at its active stage. Initially, there were seven bidders. Now there are three final bidders who have made preliminary proposals, are finalizing the due diligence, and will send their offers until the end of June.”

VEB.RF plans to sell off the gas chemistry Ammonium plant until the end of 2019, there are six bidders.

Kommersant business daily reported earlier that the pre-bankrupt facility, based in the republic of Tatarstan, is interesting for oil company Lukoil, offering U.S. $1 billion, and fertilizer producer EuroChem.

VEB.RF does not rule out consolidation of Zelenograd-based microelectronics producer Angstrem-T with another market player including joining the venture between state industrial corporation Rostec and multi-industry holding Sistema.

The U.S. blacklisted Angstrem-T in 2016, and VEB.RF gained control over the company as a creditor in late 2018. In mid-March 2019, the Moscow Arbitration Court introduced supervision, the initial stage of bankruptcy, at Angstrem-T and included a debt of over 14.3 billion rubles to VEB.RF in the list of creditor claims against the company.

VEB.RF also does not rule out selling off its stake in the Moscow Exchange as sees it as non-core.

The development institution also plans to sell its last foreign asset in the Czech Republic, metals plant Pilsen Steel, or to wind it up if there is no buyer.

VEB.RF’s Ukrainian until Prominvestbank will work as a bad debt bank because it has no prospects as a commercial bank.

In March 2017, Kiev introduced sanctions against all subsidiaries of Russian banks – Ukrainian units of Sberbank and VTB Bank, VS Bank of Sberbank, BM Bank of VTB, and VEB.RF’s unit Prominvestbank, prohibiting all financial operations in favor of affiliated parties, including parent banks.

(64.6314 rubles – U.S. $1)

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