Russia’s finances are being squeezed by a contraction in economic growth and faltering oil prices. So what better time for Russia to demand bigger dividends from its powerful state companies?
New rules forcing the likes of Gazprom, Rosneft and Sberbank to share more of their profits with investors will land an extra $8bn in the Russian budget in 2014 and continue to boost state coffers for years to come, according to a report by Markit Equities Research, the financial information services company. Continue reading »
Norway has been producing oil offshore since the 1970s and hardly needs help from relatively inexperienced Russia.
So presumably it’s for strategic reasons that Norway’s energy ministry decided this week to award Russian oil companies rights to explore on the Norwegian continental shelf for the first time. The two countries do after all share an offshore frontier. Continue reading »
It’s curious to see where the three Soviet-born tycoons who sold their 50 per stake in TNK-BP to Rosneft this year will invest the proceeds of the deal. While some are tempted to stick to oil, Leonard Blavatnik, the chairman of Access Industries, has branched out into the booming Russian e-commerce industry, buying a stake in Lamoda, the online fashion retailer. Continue reading »
Rosneft has been warning minority shareholders in TNK-BP not to expect any favours, ever since it took over the Anglo-Russian oil producer. All the same, it’s a disappointment for these shareholders – who have regularly received fat payouts – to learn on Thursday that they won’t be getting any dividends this year.
Minority shareholders – mostly foreign long term investors – hold around 5 per cent of TNK-BP Holding, the listed unit of TNK-BP, that was acquired by Rosneft together with the parent company in a deal announced last year and completed this March. Continue reading »
There has been an ugly twist in the long running feud between Nursultan Nazarbayev (pictured) and Mukhtar Ablyazov, the fugitive former chairman of Kazakhstan’s BTA Bank.
If it was not for the involvement of the Italian police and a modern jet plane, this disturbing story would sound as if it came straight out of the ancient annals of warring central Asian Khans. Continue reading »
Sistema, the Russian conglomerate, has nominated Lord Mandelson (left) to its board in what is clearly a move to tap the British peer’s public relations skills.
Russian companies set great store by corporate PR to counter the country’s dismal international image. But billionaire controlling shareholder Vladimir Yevtushenkov will be hoping that not too many people recall how his lordship’s ties with another Russian oligarch, Oleg Deripaska, ran into political controversy. Continue reading »
Russia has not been the Eldorado that international oil majors hoped when it opened up to outside investors after the Soviet Union collapsed. But that has started to change as Rosneft, Russia’s powerful state oil company, moves outside its comfort zone and begins to explore in remote and challenging offshore areas. In the latest of a string of foreign deals, Rosneft has teamed up with Japan’s Inpex to explore waters off Russia’s far eastern coast. Continue reading »
A contraction in Russian economic growth is taking a toll on consumer confidence. But while Russian shoppers are spending more carefully, it appears they can’t say ‘no’ to their kids. Detsky Mir, the country’s biggest children’s goods retailer, is anticipating a double-digit increase in revenues in 2013 for the second year in a row and is confident enough about the outlook to begin planning for an initial public offering. Continue reading »
When Russia’s Communist party called for a Moscow street to be named after Hugo Chávez in March, the city authorities refused on grounds that the former Venezuelan leader had not been dead long enough to qualify for the honour. However, in a sign of the importance Russia attaches to Venezuelan relations, Igor Sechin, the powerful chief executive of Rosneft, wants Moscow to waive the rules. Visiting Caracas this week to finalize a big oil deal, Sechin said a Chávez street should indeed be added to the map of the Russian capital. Continue reading »
After an abnormally cold winter it’s a relief for Muscovites to be out basking in the unusually hot May sunshine. But a thousand miles away in the grain belt of southern Russia, farmers are already praying for rain.
Russia is traditionally one of the world’s top three wheat suppliers, but its vast agricultural lands are highly vulnerable to extreme weather. The southern federal district bordering the the Black Sea coast is Russia’s biggest grain producing and exporting region and the results of the harvest have major implications for global food markets. Continue reading »
Russian equities started the week strongly with a 0.7 per cent rise in the dollar-based RTS index boosted by solid global markets and relief at the latest domestic economic data.
As reported on Friday, Russia’s gross domestic product expanded by 1.6 per cent in the first quarter of 2013 as economic growth slowed for the fifth quarter in a row. That wasn’t great, of course, but it was better than the economy ministry’s forecasts. Continue reading »
Investors who participated in the controversial MegaFon flotation last year made a good bet buying shares in Russia’s second biggest mobile telephone operator.
After the company reported stellar results for the first quarter of 2013 on Wednesday and announced plans for a whopping dividend, the Moscow-traded stock rose 7.4 per cent, taking the gain since the November IPO to 65 per cent. Great for the IPO investors. Not so great for TeliaSonera, the Nordic group, which sold a hefty slice of its stake at the time. Continue reading »
Russia is casting around for ways to boost government revenues as economic growth slows amid fears of a looming recession.
One idea is to go to state-controlled companies and ask them (again) for higher dividends. Only six months ago rules were introduced obliging state-run companies and their subsidiaries to pay 25 per cent of net profits to shareholders. Now the Russian finance ministry has floated a plan to force state companies to pay out at least 35 per cent. Continue reading »
India’s Tata Power has agreed to invest in two hydroelectric projects in Georgia that will help the impoverished South Caucasus country transform its mountain rivers into an export revenue stream.
Tata’s vote of confidence is an important boost for Georgia where a fresh bout of political turmoil is driving foreign investment away.
Continue reading »
Another strand is playing out in the saga over Kazakh oil and gas: the government in Astana has decided against increasing its stake in the enormous Kashagan oil field as ConocoPhillips exits the project.
None of the other international majors involved appear willing to increase their exposure to what is turning out to be the world’s most expensive oil development, ever. That leaves Kazakhstan to play India and China off against each other for access to Kashagan’s vast oil reserves. Continue reading »