Merger Set To Create Real Estate Powerhouse

Korporatsia Inkom and the Moscow Central Property Exchange, or MPE, have begun merger talks that would create the countryТs largest real estate agency, MPE said.

The combined company, operating under the name Inkom MPE, would inherit the largest subsidiary network in Moscow and employ 1,600 to 1,700 people, said Konstantin Popov, chairman of MPE's board.

The new company's monthly turnover would be $650,000, said Alexei Fedotenkov, Inkom's general director. This is one-third the total turnover of the so-called "big five" Moscow real estate agencies, which also include the Moscow City Real Estate Service, the Moscow Real Estate Investment Agency and Miel. The group accounts for about 20 percent to 25 percent of the capital's property market, the estimated worth of which is $9 million to $11 million per month.

The share of each agency in the charter capital of the new company will be 50 percent with responsibilities to be divided accordingly: The head of Inkom, Sergei Kozlovsky, will become president in the new structure, while the chairman of the board of directors will be Popov. The president of MPE, Alexander Savenko, will join the board of directors and will be responsible for the companies' special projects, Popov said.

"We plan to occupy a leading position in all sectors of the market, including leasing and commercial real estate," Fedotenkov said. He added that MPE's high-quality technology will enable Inkom structures to speed up transactions, increase their safety and reduce the number of quasi-legal deals.

At the same time, Inkom is more experienced working with apartment leases, and its total monthly turnover is higher Ч $400,000 per month compared with $250,000 at MPE.