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December 7, 2018 www.intellinews.com I Page 2
Kremlin to buy Alfa Bank from oligarch Fridman
When asked by a bne IntelliNews correspondent at dinner in the 90s if he would ever sell Alfa Bank, at that time the biggest and most profitable privately owned bank on the market, Fridman replied: “Of course. I will always sell. If the price is right. And for Alfa Bank it will have to be a very good price indeed.”
A plan to sell Alfa to one of the state banks has been across President Vladimir Putin’s desk,
the sources claim. The future of Alfa as an independent private player has been in jeopardy ever since Fridman transplanted himself to the UK and opted to invest his $14bn bounty from the $55bn sale of the oil producer TNK-BP to Rosneft in projects outside of Russia.
Following the TNK-BP deal Putin said in a speech shortly afterwards that the oligarchs were free
to spend their money as they liked, but added ominously: “I would encourage them to invest
it into Russia.”
For some, the last straw for the Kremlin was when Fridman and his partners swooped to
buy Holland & Barret, the iconic UK high-street vitamins retailer, a year ago for $1.7bn after a string of other British and overseas acquisitions.
“The ‘For Sale’ sign for Alfa effectively went up when he bought Holland & Barret,” said a Russian invest- ment banking source. “So much for heeding the Kremlin’s call for oligarch to repatriate his wealth, Fridman was spending it anywhere but Russia.”
Fridman’s move out of Russia is not unusual as most of the oligarchs from Yeltsin-era have either been forced out, fled into exile, or are gradually winding down their positions in Russia. Notably from the original seven oligarchs that ruled the roost in the 90s, only Vladimir Potanin, who con- trols Norilsk Nickel, is still active. Fridman owns
several other important assets in Russia, most notably the X5 Retail Group, that is currently mar- ket leader and still growing.
Officially, Alfa is denying any future sale but banking insiders insist a deal is on the cards.
“The information about possible sale of Alfa Bank is untrue and is not consistent with the reality,” Anastasia Glukhova, a spokeswoman for Alfa Bank in Moscow, told bne IntelliNews.
VTB CEO Andrei Kostin also went on record last week to deny rumours that his bank was in talks to buy Alfa. VTB announced that there were no plans to buy Alfa-Bank or a stake in it in the next three years, Interfax reports, citing Kostin speak- ing on the sidelines of the VTB annual Russia Calling investment conference on November 28.
The rumour mill about a potential VTB deal started ticking in July after Alfa hired Vladimir Verkhoshinsky from the state bank in the summer to be its new chief executive. His predecessor Alex Marei had been elbowed last year amid criticism that the bank had been left behind in the fintech stakes by its retail rivals Sberbank and the online- only bank Tinkoff.
Another comment by Kostin was rather bizarrely carried by Alfa in their website statement regarding the appointment of Verkhoshinksy, who spent al- most a decade as a senior executive under Kostin.
“Verkhoshinskiy is a top professional and a talented manager,” Kostin. “It’s a shame he’s leaving VTB Group but the offer he got to run Alfa-Bank is a big opportunity for his further professional and career growth. I think he made the right decision and sincerely wish him success in his new position.”
Some analysts think Verkhoshinsky, who appears on the popular Russian TV quiz show ‘What? Where? When?’ could be “a Trojan horse” so VTB can get an insider’s take on the Alfa books before any formal takeover bid.