Chinese Investment Corp. to Buy 5 Percent Stake in Russian Sberbank
Jun. 28 – China Investment Corporation, the country’s US$300 billion sovereign wealth fund, is considering buying a 5 percent stake in OAO Sberbank, Russia’s biggest lender, media reports say. According to Interfax, the first round of negotiations has already taken place.
Sberbank, a crown asset in Russia’s three-year US$35.5 billion privatization drive, is selling off a stake of up to 7.6 percent by mid-September and is expected to roll out its privatization program soon, China’s 21st Century Business Herald reports.
The bank is expecting to raise around US$6 billion through the sale of a 5 percent stake to the Chinese fund, which manages part of the country’s foreign exchange reserves.
The Russian central bank, which owns a 57.6 percent stake in Sberbank, has appointed Goldman Sachs, Morgan Stanley, JPMorgan Chase, UBS and a Russian investment firm to be co-financial counselors for the sale.
Russian Market Entry – The Business Outlook and Your Options
In this issue of Russia Briefing, we discuss why you should consider investment in Russia and how to make the first major decision in this process: what form of entry establishment to use. Considerations such as whether the entity will conduct commercial activity, the extent of legal liability the parent company wishes to take on, establishing a tax presence, and the ability to apply for the simplified “Highly Qualified Specialist” work permit all come into play.