By Jason Corcoran
VTB Capital, the nascent investment banking arm of the state bank VTB, is expected to announce its acquisition of a 20% stake in brokerage Otkritie later today.
Rumours of the deal had circulated from late last year following the banking crisis which led to the bankruptcy of a number of cornerstone Moscow financial institutions.
A number of firms have been forced to give up their independence as the Russian market was hit by the financial crisis late last year. Since then both leading domestic brokers, Renaissance Capital and Troika Dialog have sold large stakes to ONEXIM Group and South Africa’s Standard Bank, respectively.
VTB Capital had at one stage put in bid for Renaissance and had looked at buying a number of investment operations in Moscow.
It may try to leverage Otkritie’s brokerage, sales and trading operations as they have had little time to get their own platform up and running since launching.
In late last year, Yuri Soloviev, Global CEO of VTB Capital, said Otkritie’s business had developed in segments in which VTB which we are not present in.
On the bank’s site in December, Soloviev, said: “VTB Group has a rather unique platform and we, for example, can find some unfinished projects and offer them to one of our client-developers. In a given context, Otkritie could be very interesting to us.”
Of especial interest to VTB will be Otkritie’s impact in the M&A market in the financial sector. The state has expressed a strong desire to see consolidation in the bloated financial sector and Otkritie is already involved in a number of restructurings.
Data provider last year ranked Otkritie among the largest M&A advisors by volume of transactions in Russia and Eastern Europe. In 2008, the company successfully implemented 49 transactions worth of $12 billion in the region.
The company has been operating on the stock market as a broker, asset manager, financial advisor and investment bank since 1995.
