Renaissance Group Chief Predicts Increase in M&A

MTJennings speaking after selling half of Renaissance Capital on Sept. 22.
The financial crisis will spur mergers and acquisitions in Russia as many businessmen have accumulated enough cash to buy troubled assets, Renaissance Group chief executive Stephen Jennings was quoted as saying Tuesday.

"In today's Russia, many businessmen have to sell their assets, and those who have liquidity are buying them. As a result, the M&A activity is rising, and this is a very profitable business for us," Jennings told Kommersant.

Jennings and his partners in Renaissance Group sold 50 percent minus one share in their investment banking business, Renaissance Capital, to Mikhail Prokhorov's Onexim holding company earlier last month for $500 million amid a liquidity crisis and collapse of the local stock market.

State banks, including VTB, had valued Renaissance at more than $4 billion before the crisis, according to media reports at the time.

Jennings denied that he was forced to sell a stake at a knockdown price because the bank failed to meet some obligations and added that the deal was aimed at sending a signal to the market, recently hit by a crisis of confidence, that the investment bank's operations were stable despite a tough period of liquidity shortage.

He also denied rumors that the sale came after Renaissance took heavy losses on its equities portfolio, saying losses were not substantial in the third quarter.