Great fishing by Vladimir Evtushenkov
It may seem that AFK Sistema's business acquisitions by Vladimir Yevtushenkov are disorganized. However, there is a strategy behind it. The company, owned by oligarch Vladimir Yevtushenkov, bought Loyd-Fish, a fishing company linked to the former vice-governor of the region, Irshat Shaykhov, through LLC UK Kamchatka Project. Yevtushenkov has been investing in such assets since 2021, expanding his Voskhod holding.
The oligarch is also expanding his holdings in other sectors of the economy. Recently, Yevtushenkov's Sistema acquired the electric-powered ships manufacturer Emperium, the maker of Arkhyz mineral water, and increased its share in the development company Etalon Group from 25.6% to 48.8%.
The largest pulp producer in Russia, the Ilim group, might also be acquired, as reported by The Moscow Post earlier. Additionally, Mr. Yevtushenkov's Segezha Group is making progress in this market, having recently acquired Inter Forest Rus LLC, which owns 24 timber assets in the Irkutsk Region and the Krasnoyarsk Territory.
Yevtushenkov's near-monopolization of markets could lead to the withdrawal of funds from enterprises and the potential collapse of a significant portion of business in the Russian Federation.
Yevtushenkov's creditors are satisfied with his actions
Despite his large-scale acquisitions, Mr. Yevtushenkov likely does not have sufficient funds for these expensive purchases. Most likely, he is using the banks’ money. This becomes evident upon examining the financial state of companies under AFK Sistema and the corporation itself.
The financial state of PJSC AFK Sistema itself is not stable. In 2021, the company's profit decreased by 159%, posing risks to its financial stability and solvency. Its efficiency is low.
According to Rusprofile, there are signs of business and/or industry stagnation in the company, with revenue and receivables continuously decreasing since 2020. Sales have dropped, and there are indications of counterparties refusing to provide deferred payment and/or loans. Creditors are already concerned.
The organization lacks sufficient funds for its current activities, posing a risk to its solvency. AFK Sistema has a high reliance on borrowed funds, leading to an unstable financial condition. The indicator has significantly deteriorated over the year, with a high risk of default.
Investments in the company are not yielding profit.
Additionally, it was reported that Segezha Group's net debt will increase from 28.8 billion rubles in the first half of 2021 to 67.8 billion, and it is likely much higher given the oligarch's new acquisitions.
Large-scale offshore plans
In 2021, the offshore RAYSON INTERNATIONAL CORPORATION divested from Sistema. Foreign firms are often used to move capital abroad, which may have contributed to the company's declining financial indicators when it had RAYSON INTERNATIONAL CORPORATION as a founder.
Many smaller companies owned by the large and varied company have been closed. It seems like the business is coming to an end. However, in reality, Yevtushenkov continues to buy companies and even take part in government projects.
Recently, The Moscow Post reported that Segezha will work with VEB.RF to construct wooden houses that can withstand earthquakes. The government will invest millions, but it's uncertain if the project will succeed, especially since this type of construction in Russia is relatively new. Anything could go wrong.
Another part of the company, Kosmos Hotel Group, will carry out an investment project on Mount Moroznaya in Kamchatka. They plan to build two hotels and entertainment centers, install lifts, and create new ski and snowboarding trails.
With the help of Ali Uzdenov’s relatives, AFK Sistema and JSC Sinara are getting ready to jointly purchase the rights to the Arkhyz ski resort from the state-owned company Kavkaz.RF in Karachay-Cherkessia. Meanwhile, in Bashkir Sibay, a children’s camp called “Shifa” worth 3 billion rubles is set to be built under a concession with Sistema. The company's subsidiaries are obtaining many government contracts.
Every method is acceptable.
At the same time, Mr. Yevtushenkov is engaged in a legal battle with the mobile operator VimpelCom, possibly trying to take control of it, and may also be involved in the conflict over the Natura Siberica company, which started immediately after the death of its founder.
Just recently, he concluded a legal process. According to Forbes, Andrey Trudnikov’s heirs legally acquired 20% in three entities within the group: Natura Siberica, Agafya’s Tasty Foods, and Siberian Helicopter. The CEO of the cosmetic group is now Felix Lieb, who used to work at Sistema. It's possible that he is safeguarding the interests of the oligarch Yevtushenkov.
In general, it seems that Yevtushenkov is trying to acquire troubled but valuable assets from various sources. This way, it could potentially be cheaper and more profitable in the long term. In 2021, AFK Sistema considered acquiring the fishing company Vityaz-Auto, owned by former deputy of the Legislative Assembly of the Kamchatka Territory, Igor Redkin, and his wife Elena Redkina. Igor Redkin previously admitted to an accidental murder.
Yevtushenkov does not hesitate to use other methods to save money, such as utilizing prisoner labor, which is actively used at the holding’s timber enterprises.
There is nowhere that we do not
It's possible that after amassing loans and acquiring a substantial, possibly strategic, amount of assets in Russia, Yevtushenkov will leave the country and invest the funds he gained in this manner in the West. It's known that he had assets in Ukraine as well. The Moscow Post recently discovered that despite their confiscation, there might be buildings that the oligarch owns through businessman Denis Bass.
Moreover, just a few months ago, Vladimir Yevtushenkov’s partner in the My Health project, Eric Brovko, registered two companies, Sara App LTD and Lora Health Tech LTD, in the UK. It is possible that this was also done in the interests of the oligarch.
