Page 8 - bne IntelliNews monthly country report Russia February 2024

2.0 Politics
2.1 Kremlin causing problems for Barings Vostok fund
splitting Russia and international assets, Ozon stake in focus
After a high-profile criminal case, the founder of the Baring Vostok fund, Michael Calvey, who was sentenced to five and a half years probation in Russia, left the country, and after the start of the war he decided to quit Russian business, The Bell reports.
Baring Vostok's assets were to be transferred to the fund's Russian management by the end of 2023. But the authorities have not yet agreed on the deal. The reason may be the Kremlin’s interest in Baring Vostok’s 27.7% stake in the Ozon marketplace, The Bell’s sources say.
Throughout this year, Baring Vostok, like many other foreign investors, has been trying to coordinate its exit from Russia with the Russian authorities. It has been known that Baring was preparing for an exit since the end of 2022. The deal had to be approved by the government commission for monitoring foreign investment. But the presidential administration intervened in the matter.
Baring Vostok has a total of a dozen attractive companies in its portfolio that will be affected by the exit. Agreeing on a deal with these important assets will not be easy. The main problem was Baring’s share in Russia’s second largest marketplace Ozon, according to three of The Bell’s sources familiar with the progress of the restructuring. In total, the fund owns 27.7% of the retailer's shares.
Another major shareholder of Ozon with 31.8% is AFK Sistema owned by Vladimir Yevtushenko, which also has had run ins with the Kremlin. Yevtushenko was placed under house arrest in September 2014 after a clash with state-owned oil major Rosneft and it’s all-powerful CEO Igor Sechin, which was only resolved after Sistema agreed to pay Rosneft more than $1bn.
The presidential administration will not approve the Baring Vostok divorce precisely because of its stake in Ozon, one of the sources claims reports The Bell. Another source says the Kremlin would not want the valuable asset to go to Baring Vostok's Russian managers. As part of the exodus of western investors, the Kremlin has been redistributing their property to well-connected businessmen close to the Kremlin. In this case among those interested in Ozon are structures associated with the former CEO of Megafon, Ivan Tavrin, who is actively involved in the sale of Internet assets of foreigners leaving Russia due to the war and is one of the contenders for the purchase of Yandex shares. But a source close to Tavrin denies interest in Ozon, reports The Bell.
8 RUSSIA Country Report February 2024 www.intellinews.com