. Last Updated: 07/27/2016

Vekselberg Buys 6 Regional Energo Stakes


Viktor Vekselberg

Viktor Vekselberg, co-owner of No. 4 oil major Tyumen Oil Co. and No. 2 aluminum holding SUAL, has accumulated sizeable stakes in six regional energy suppliers through a newly founded company called Complex Energy Systems.

CES spokeswoman Olga Kiselyova said the company will manage energy assets owned by Vekselberg personally and by investment company Renova, in which Vekselberg owns a stake, and is interested not only in cheap power generation, but also heat, power distribution and utilities.

"This is unique," Zenit Bank analyst Sergei Suverov said. "A well-known business leader not only officially announced an interest in power, but emphasized that the sector itself interests him, not only for the chance to buy cheap energy to use for industrial production."

He said Vekselberg was probably looking for a good way to invest the money he earned from selling stakes in SUAL and the Tyumen Oil Co., or TNK.

Vekselberg was one of the beneficiaries of the $6.75 billion deal struck last month between BP and TNK, and of the multimillion-dollar partnership deal struck between SUAL and London-based Fleming Family & Partners in January.

However, some analysts suggested the new company is unlikely to work autonomously from SUAL and TNK.

Aton analyst Alexander Korneyev noted that SUAL operates aluminum smelters in six regions where CES has invested.

The energy-intense aluminum industry benefits strongly from cheap domestic power.

CES now manages a 10 percent stake in Irkutskenergo, owned by Vekselberg through affiliated organizations since 2000. It also holds significant, but unspecified, stakes in the Pechora hydroelectric plant and the local energos in Perm, Rostov-on-Don, Sverdlov, and the Komi republic. CES employees have been nominated to the boards of these five companies.

The number of shares held by CES "varies and may change before the next shareholders meeting," a source close to SUAL said.

CES's stakes in Rostovenergo, Permenergo and Komienergo are already large enough to influence decision making, the source added.

But the stake in Sverdlovenergo is "insufficient," to wield full control, he said.

Oleg Fyodorov, an executive with the Investor Protection Association, estimated that Vekselberg now holds blocking stakes in the Rostov and Perm energos.

Fyodorov, who also sits on Sverdlovenergo's board of directors, estimated CES's stake in that firm at about 10 percent.

The SUAL source termed CES's stake in the Pechora hydroelectric plant "a chance investment."

The energos themselves said they could only guess about their new owners.

Only Sverdlovenergo said the new investors had come to meet with company management.

Management at Komienergo and Permenergo said they had not known for sure whether their new shareholders were LUKoil or SUAL even after new board candidates were nominated.