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. Last Updated: 07/27/2016

Business in Brief

Moskvich Plug Pulled

MOSCOW (MT) -- Moscow utility Mosenergo on Monday cut the last of already-reduced electricity supplies to indebted carmaker Moskvich, said Mosenergo spokesman Mikhail Korotkov.

Moskvich owes the utility a total of 600 million rubles ($19.4 million), Mosenergo said.

The utility has been gradually reducing electricity supplies over the past two years after Moskvich stopped paying for energy, but never cut it off completely.

Mosenergo said that on April 1, it plans to stop providing the carmaker with heat if the debt problem is not resolved.

Interfax quoted Mosenergo general director Vitaly Kuzmin as saying the power plant would get some of Moskvich's property in a debt settlement.

Debt Rating Cut

LONDON (Reuters) -- U.S. investment bank Morgan Stanley said Monday that it had cut Russia's debt to "market perform" from "outperform," saying current prices have run ahead of economic fundamentals.

Morgan Stanley said it expects the country's credit standing to improve and economic reform to continue. However, it said the reforms now under way are longer term and will not translate as quickly into higher bond prices as those that have already taken place.

Gazprom Needs $2Bln

MOSCOW (Reuters) -- Gazprom will have to borrow at least $2 billion abroad to cover its budget shortfall this year, Vedomosti reported Monday.

The newspaper quoted an unnamed Gazprom official as saying the company, which already had foreign debts of $12.7 billion, would need to borrow $5.66 billion in total for this year.

The official said Gazprom's board on Friday had approved the 175.5 billion ruble ($5.66 billion) borrowing, 40 billion rubles more than in 2001. Gazprom is also considering selling a 4.5 percent stake held by Gazprom Finance BV, its Dutch affiliate.

German Debt Talks

MOSCOW (AP) -- Russia and its largest sovereign creditor, Germany, will resume talks on Russia's Soviet-era debt in mid-March, a top finance official said Monday.

Russia will try to reduce the amount of debt to be repaid to about $800 million, down from the $1.2 billion Germany is asking. The debt, run up as a result of trade between the Soviet Union and the former East Germany, had stood at around $3 billion, but Russia has negotiated that sum downward.

"The sum [of $1.2 billion] is not final and is unacceptable for Russia," Deputy Finance Minister Sergei Kolotukhin told Interfax. "That is why we are continuing talks."

Rosgosstrakh Chief

MOSCOW (MT) -- The president of investment house Troika Dialog is the No. 1 candidate to head No. 1 state-controlled household insurer Rosgosstrakh, newspapers reported Monday.

Troika acquired a 49 percent stake in Rosgosstrakh at three auctions in 2001, reportedly for a consortium of unnamed Russian companies, paying a total of 1.36 billion rubles ($45.3 million). The nomination of Troika's Ruben Vardanyan is expected to be considered at a Rosgosstrakh extraordinary shareholders meeting March 22, Vedomosti and Kommersant reported.

Yukos to Come Clean

MOSCOW (MT) -- No. 2 oil major Yukos plans to disclose information on all its major shareholders at the company's annual shareholders meeting expected to be held in June, Yukos CEO Mikhail Khodorkovsky said.

"We have reached an agreement with all owners to announce all major company shareholders before the meeting," he said. "Our investment bankers have said that we should disclose this information simultaneously, and for this reason I cannot disclose my stake.

"Everything will become clear by June," Khodorkovsky added.

Volga Merger Approved

MOSCOW (MT) -- The Anti-Monopoly Ministry last week approved the consolidation of 11 telecom companies in the Volga Federal District, Prime-Tass reported Deputy Anti-Monopoly Minister Anatoly Golomolzin as saying Monday.

The telecoms are expected to form a single company called Volga Telecom -- anchored by Nizhegorodsvyazinform, a fixed-line telecom services provider in the Nizhny Novgorod region -- by the beginning of 2003.

New Pulkovo Terminal

MOSCOW (MT) -- St. Petersburg's Pulkovo Airport opened a new, $13 million cargo terminal Monday, news agencies reported.

A joint project between St. Petersburg's Lenaeroproject and Germany's Lufthansa Consulting, the terminal can process 30,000 tons of cargo a year.

The European Bank for Reconstruction and Development helped finance the terminal's construction.

The new terminal will be run by Pulkovo Cargo Terminal, a Russian-German joint venture set up in 1997. Pulkovo Airport owns 40 percent of Pulkovo Cargo, while Lufthansa subsidiary Globe Ground holds 40 percent and Russian construction company Lenstroizhilservice holds 20 percent.

Lord Yukos

MOSCOW (MT) -- Lord Owen, a member of Britain's House of Lords, has been appointed chairman of London-based Yukos International, Yukos said Monday in a press release.

Owen will remain chairman of Middlesex Holdings, a metal-trading holding, and vice chairman of, a web-based platform for trading steel that was founded by Middlesex, Gazprom and Interfax.

"As a respected global statesman, he has the ability and experience to move Yukos' European business into a new and exciting phase," Yukos CEO Mikhail Khodorkovsky said in statement.

Vodka Export Deal

MOSCOW (MT) -- The Novosibirsk-based Vinap alcohol company has signed a 15-year agreement worth "hundreds of millions of dollars" to supply its Sobol vodka brand to the United States, the Kommersant newspaper reported Monday.

Vinap will export the vodka via branding and marketing company Marinelli Communications.

The company comprises five factories producing wine, champagne, soft drinks, spirits and beer. Vinap's total capacity is 15.5 million decaliters per year. The company produced 1.1 million decaliters of vodka in 2001.

Kommersant quoted company sources as saying Vinap would supply Sobol vodka worth $30 million each year. Over 15 years, the company intends to sell $400 million worth of the vodka, the sources said.

For the Record

Russia exported 98,538 vehicles worth $299.3 million in 2001, Prime-Tass reported a State Customs Committee official as saying Monday. Russia exported 112,644 cars worth $349.161 million in 2000. (MT)

Oil exports to countries outside the Commonwealth of Independent States rose 7.7 percent year on year to 11.657 million tons in February, Prime-Tass reported an oil industry source as saying Monday. (MT) n The amount of crude received by Russia's oil refineries rose 7.9 percent year on year to 14.529 million tons in February, Prime-Tass reported an oil industry source as saying Monday. (MT)

Sibneft has added $125 million to a $250 million Eurobond it floated earlier this year. The bond carries a coupon of 11.5 percent and is scheduled to be redeemed in February 2007. (Reuters)