11 Sep 2009 12:26

Prosperity buys into Russian car maker Sollers

MOSCOW. Sept 11 (Interfax) - Prosperity Capital Management's Prosperity Russia Domestic Fund acquired 2% of Russian car maker Sollers in August, the Fund said in a report.

The Fund did not say whether it bought the stake on the market or directly from an investor.

The 2% stake is worth about $8 million, judging by the latest quotes for Sollers on the RTS stock exchange.

Sollers, formerly known as Severstal-Auto, manages the Ulyanovsk Automotive Plant, Zavolzhsky Motor Plant , Sollers-Naberezhniye Chelny and Sollers-Elabuga. The company produces UAZ, Fiat, Isuzu and SsangYong models.

Alexei Mordashov's Severstal steel group spun Severstal-Auto off at the beginning of 2002. Vadim Shvetsov, the Severstal-Auto chief, bought Mordashov out of the company in 2007 and became its controlling shareholder with 58%. The company re-branded in 2008.

The Sollers stake is not Prosperity's first shareholding in the Russian automobile industry. The Fund has owned preferred shares in the GAZ auto works for several years. It has not said how much of GAZ it owns, but the fact it nominated candidates for the GAZ board (GAZ did not pay dividends, so prefs gained voting rights) suggests that the Fund owns at least 2%.

Prosperity Russia Domestic Fund also said it acquired preferred shares in oil pipeline operator Transneft in August (the size of this stake was not specified) and shares and increased its stake in meat company Cherkizovo.

The Fund's biggest investments are still Breweries and retailers Magnit , M.Video and Dixy.