Troika Acquires 17% Stake in AvtoVAZ, Subsidiaries to be Liquidated

Russian state arms dealer Rosoboronexport has sold its 17 percent stake in carmaker AvtoVAZ to the country’s largest investment company, Troika Dialog. Rosoboronexport took over management of the firm in 2005 and has worked to eliminate the plant’s cross-ownership.

With Troika’s acquisition, they plan on converting the company’s subsidiaries’ 66.5 percent of the voting shares of AvtoVAZ into treasuries and redeemed. This will leave Troika with the controlling stake in the company. There will be no funds exchanged for the redemption of the treasuries, as the subsidiaries will simply be liquidated or integrated into AvtoVAZ. Rosoboronexport will then assume management control of the carmaker. This action should increase the value of AvtoVaz stock.

AvtoVAZ (www.vaz.ru)
As one of the leading manufacturers of cars in Russia and one of the largest automakers in Europe, AvtoVAZ produces over 750,000 cars each year. The company controls more than 70 percent of the market share in Russia and a joint venture with General Motors to produce an SUV, the Chevy-Niva, and a car, the Chevy Viva.

AvtoVAZ produces 14 models of vehicles, specializing in its Lada line of cars and trucks. 41.5 percent of the venture is controlled by AvtoVAZ and GM, while the European Bank for Reconstruction and Development also has a large share.

The company’s revenue is roughly USD 6.7 billion.

Troika Capital Partners (www.troika.ru)
Founded in 2005 in Moscow, Troika Capital Partners focuses on investments in established companies. TCP has offices in London and Kiev.

Retail, consumer and business services, food, healthcare, packaging services and financial logistics and services are its primary markets. With additional investments in the telecommunication and media sectors.