Moscow press review for January 16, 2012
MOSCOW. Jan 16 (Interfax) - The following is a digest of Moscow newspapers published on January 16. Interfax does not accept liability for information in these stories.
POLITICS & ECONOMICS
President Dmitry Medvedev is continuing to reform Russia's political system and could reinstate direct gubernatorial elections as early as the first half of 2012. The relevant bill is ready and Medvedev will soon submit it to the State Duma. It does not currently mention anything about the notorious "presidential filter" for gubernatorial candidates (Kommersant, p. 1).
The Russian government's demand that state companies disclose the beneficiaries of counterparties has caused problems that could bring a number of sectors to a standstill. The problem is that counterparties technically include clients, so railroad and power companies, for example, have asked hundreds of thousands of shippers and customers to disclose their owners or risk having contracts cancelled (Kommersant, p. 1).
The Finance Ministry has drafted a bill to ratify an agreement between Russia and the United Arab Emirates to exempt investment income from taxes, which the government hopes will attract generous Arab investment. The agreement is unique in that it is with an offshore nation, will apply only to state companies and reduces the tax on dividends to zero. (Kommersant, p. 2).
OIL & GAS
Ruspetro plans to raise $300 million-$500 million with the sale of 30% of its shares in an IPO on the LSE this week. The oil company, which is owned by former Unified Energy System executives Andrei Rappoport and Alexander Chistyakov, will be the first company with Russian assets to risk an IPO since the turmoil on world markets began last summer (Vedomosti, p. 7).
UTILITIES
Russian power companies are preparing an appeal to the government to ease the terms of an order for state companies and banks to disclose the beneficiaries of their counterparties. The government is breaking the law, lawyers agree (Vedomosti, p. 1).
METALS & MINING
Russian steel major Severstal has managed to persuade investors to participate in the spin off of gold mining company Nord Gold, 10% of whose shares will be in free float. In line with LSE rules, Nord Gold is expected to be listed in London by Thursday (Vedomosti, p. 7).
The Russian coking coal market could shrink by about 8% in February. Kemerovo's Sibuglemet, Russia's second largest coking coal producer, has failed to gain regulatory approval for its mining plans for 2012, so over 80% of its production is sitting idle. Novolipetsk Steel could be hardest hit among Russian steelmakers by Sibuglemet's problems (Kommersant, p. 7).
BANKING, FINANCE & INSURANCE
Banks continue to borrow heavily from the Central Bank of Russia using securities as collateral. There is even demand for Central Bank funds provided at fixed rates, which cost banks more than borrowing in repo auctions. Banks borrowed 51 billion rubles from the Central Bank in fixed rate repo deals on January 10, 11 and 12, the highest figure in two years (Kommersant, p. 8).
RETAIL & CONSUMER MARKET
Switzerland's Dufry, which owns duty free stores throughout the world, is combining its business in Russia with the RegStaer group. Dufry has acquired a 51% stake in the joint venture Dufry Staer, which will operate 21 duty free stores at Moscow's Sheremetyevo, Vnukovo and Domodedovo airports, making it the leading duty free retailer in Russia (Kommersant, p. 9, Vedomosti, p. 10).
TELECOMMUNICATIONS, MEDIA & TECHNOLOGY
Billionaire Suleiman Kerimov is already in the process of selling the 6% stake in Rostelecom that he bought for about $880 million in November 2011. Sources close to Kerimov said he has received a lucrative offer for the stake, while industry sources said the Russian authorities did not approve of his involvement in the national telecommunications company (Vedomosti, p. 1).
Interview: Sergei Soldatenkov, the longtime CEO of mobile carrier MegaFon, who is expected to step down in June (Kommersant, p. 10).
AUTOMOTIVE & ENGINEERING
The St. Petersburg Arbitration Court on Friday launched bankruptcy proceedings at the United Industrial Corporation's Baltiysky Zavod, which has debts of 15 billion rubles. This brings the state-owned United Shipbuilding Corporation another step closer to taking over the shipyard (Kommersant, p. 9; Vedomosti, p. 8).
Interview: Jean-Pascal Tricoire, President and CEO of Schneider Electric, one of the world's leading manufacturers of electrical equipment (Vedomosti, p. 5).