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Sistema's Future
September 30, 2014 23:52


Photo Credit: http://finparty.ru
Vladimir Yevtushenkov’s Sistema has lost two thirds of its capitalization in the past weeks, which now totals 124 billion roubles, or some $3 billion.
 
Its shares went down from 36 roubles a share to 12 roubles, a low registered in mid-July 2009. However, there’s still room to go even lower – 3.41 roubles was an all-time low in late 2008, when Russia was hit hard with the international financial meltdown.
 
According to its official website, it is now one of Russia's top ten companies by revenues and is one of the largest investment companies in the world. Incorporated in 1993, the group owns a diverse set of public and private companies, which it holds in several distinct portfolios ranging from telecoms to agriculture.
 
Here’re some of the main assets:
MTS, Medsi, RTI, Detsky Mir, MTS-Bank, Binnopharm, Sarov Technopark, Intourist, RZ Agro Holding.
 
In 2013, Sistema received US$ 3.2 billion from exits, restructuring and dividends. Sistema's global depository receipts are listed under the symbol "SSA" on the London Stock Exchange (1 GDR is 20 ordinary shares) and the ordinary shares are listed under the symbol "AFKS" on the Moscow Exchange. 
 
In 2009, during the downturn, the company purchased a controlling stake in several BashTEK companies. According to the police, that son privatized the assets illegally and laundered the funds by selling this major oil company to Yevtushenkov’s Sistema at what they claim was a lower price, specifically with a 500 million rouble ‘discount’.
 
Sistema insists the acquisition of BashTEK group was “legal and transparent”.
 
As for the future, analysts are waiting for the political decision to be taken at the Kremlin. Here are the options:
 
  • 1.     If Rosneft forces him to sell off Bashneft, Yevtushenkov would go free.
  • 2.     If Russia’s 15th richest billionaire worth some $7 billion persists, he could lose Bashneft altogether – it will be handed over to the state and then possibly sold off to Rosneft.
  • 3.     Sistema may cease to exist as a holding following a massive depreciation, and its assets sold off one by one dirt cheap.
  • 4.     Delisting is possible, too.
 

If you have any other ideas, let us know and we’ll share them with the readers. 




Author: Mikhail Vesely

Tags: Sistema Bashneft Rosneft   

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