Sber, VEB.RF, and RDIF have reached an equity investment agreement under which they will each hold a 25% stake in JSC Prosveshcheniye. The closure of the deal on RDIF’s part is pending approval from its Supervisory Board.
The deal is a continuation of many years of joint work to develop contemporary Russian education.
One hundred percent of the company’s shares were valued for the purposes of the deal at approximately RUB 108 bn. The new shareholder structure is expected to be established in June.
Eight directors will be on the Prosveshcheniye Board of Directors, with two representatives each from Sber, RDIF, VEB.RF, and the current Prosveshcheniye shareholders. The current management of the Group will continue to handle operations.
Today Prosveshcheniye, well known to all children and parents, is the largest brand on the educational literature market in Russia. The company operates in all regions of Russia and in 190 countries worldwide, with annual print runs of over 130 million copies. Prosveshcheniye also provides direct support to educators and school students. The company’s digital platforms count 30 million unique users per month.
The parties joined efforts to increase access to Prosveshcheniye’s well-established learning content for teachers, students, and parents nationwide. The partners’ modern digital technologies, services, and competencies will facilitate the development of next-generation educational content and ensure a personalized approach to each student and new education management tools for teachers.
The partnership will also establish the necessary conditions to increase the export potential of educational products and to develop school infrastructure, including through a PPP-based model.
We understand that access to quality educational content and to modern teaching methods for every child and every teacher lays the foundation for a successful future. Combining our ecosystem’s resources together with those of our partner companies and Prosveshcheniye creates new opportunities for the sector-wide development of education and for the achievement of national development goals.
CEO, Chairman of the Executive Board, Sberbank
The goal of our partnership is to develop a modern learning environment in Russia. Prosveshcheniye went from an educational publishing house to a systemically important company in the industry, providing its clients with a wide variety of solutions: from building new schools to the creation of digital content. The new shareholder composition will enable the company to grow dynamically, contribute to the achievement of national goals, and, in time, become a global education leader.
This agreement sees the partners joining efforts to develop the basis for Russia’s future achievements and the country’s most valuable asset – human capital. A strong company that plays a key role in the education infrastructure and builds on the best Russian and international practices can take the lead in this area globally. The collaborative work of RDIF and its partners is centered on achieving these goals for all students and teachers and for Russia as a whole.
CEO, Russian Direct Investment Fund (RDIF)
The public-private partnership tool has demonstrated that the business sector can become – and is becoming – a serious source of support for the state. Prosveshcheniye Group is a key element of the education system, as well as a national educational integrator, whose products and solutions are used in every single family and school in the country. Today we are talking about pooling our resources to handle the full range of challenges currently facing the state: creating modern education infrastructure, improving quality of education in all of Russia’s regions, developing and using digital educational technologies reasonably and efficiently, and formulating new tasks. We firmly believe that the effects of this deal will be seen throughout the country in the very near future.
Chairman of the Board of Directors, Prosveshcheniye Group
Sber Press office
PJSC Sberbank is Russia’s largest bank and a leading global financial institution. Holding almost one-third of aggregate Russian banking sector assets, Sberbank is the key lender to the national economy and one of the biggest deposit takers in Russia. The Government of the Russian Federation represented by the Ministry of Finance of the Russian Federation is the principal shareholder of PJSC Sberbank owning 50% plus one voting share of the bank’s authorized capital, with the remaining 50% minus one voting share held by domestic and international investors. Sberbank has customers in 18 countries. The bank has a major distribution network in Russia with about 14,000 branches, while its international operations – subsidiary banks, branches, and chapters – include the UK, US, CIS, Central and Eastern Europe, India, China, and other countries. It holds general banking license No. 1481 dd. August 11, 2015, from the Bank of Russia. Official websites of the bank: www.sberbank.com (Sberbank Group website), www.sberbank.ru.
In 2020 Sberbank underwent a rebranding, offering financial and non-financial services of the bank and Sberbank Group to individual and corporate customers. Today, the Sber ecosystem is a raft of services for life and daily assistance in handling pressing everyday issues for individual customers and businesses. The Sber ecosystem website: www.sber.ru.
VEB.RF Press service
firstname.lastname@example.org, +7 (495) 721-94-90
VEB.RF is a state development corporation that implements national projects in partnership with commercial banks and private investors. The scope of its activities includes providing support for high-tech industry, non-resource exports, modernization of infrastructure, and urban agglomerations. VEB.RF Group’s capital amounts to RUB 689.0 bn, with assets of RUB 3,406.1 bn and a capital adequacy ratio of 17.1% (as of December 31, 2020).
RDIF Press service
email@example.com +7 (495) 644-34-14
Russian Direct Investment Fund (RDIF) is Russia's sovereign wealth fund established in 2011 to make equity co-investments, primarily in Russia, alongside reputable international financial and strategic investors. RDIF acts as a catalyst for direct investment in the Russian economy. RDIF has experience in the successful joint implementation of more than 80 projects with foreign partners totaling over RUB 2 tn and covering 95% of the regions of the Russian Federation. RDIF portfolio companies employ over 800,000 people and generate revenues equating to more than 6% of Russia’s GDP. RDIF has established joint strategic partnerships with leading international co-investors from over 18 countries that total over USD 40 bn. Further information can be found at rdif.ru
Prosveshcheniye Group Press service
firstname.lastname@example.org,+7 (495) 789-30-40
Prosveshcheniye is a national educational integrator with 90 years of history. The Group comprises leading educational literature brands. Its key areas of activity are digitizing and exporting education, building and outfitting schools and summer camps for children, training educators, educational and legal consulting, and textbook publishing. Products and solutions by Prosveshcheniye can be found being used by teachers in every school and every family in the country.
VEB.RF’s Green Finance Committee has recognised the 74th issue of City of Moscow bonds as a green financial instrument in accordance with the VEB.RF guidelines. This is the second bond issue certified as compliant with the VEB.RF guidelines (after the Russian Railways bonds issued last autumn) and the first to be issued by a constituent entity of the Russian Federation. As a reminder, the green finance guidelines received approval from the inter-agency working group chaired by Russian Minister of Economic Development Maxim Reshetnikov and composed of representatives of executive authorities, legislative bodies, the business community and non-governmental institutions.
“The projects that will use the proceeds from the issued bonds are fully compliant with the taxonomy,” said Aleksey Miroshnichenko, First Deputy Chairman, VEB.RF. “These include developing the Moscow Metro, which is a fully electrified system, and replacing petrol-powered buses by electric buses. The introduction of low-emission electric vehicles is consistent with the UN Sustainable Development Goals such as Goal 11 (Sustainable Cities and Communities) and Goal 13 (Climate Action). Monitoring how the proceeds are used will also be in accordance with our methodology.”
Together the projects will result in a potential reduction of 10,000 in the number of necessary motor vehicles by 2023, thus decreasing pollutant emissions by 885.5 tonnes per year and carbon dioxide emissions by 20,900 tonnes per year.
“The Moscow bonds were issued to increase funding for development projects. The city meets all its social obligations at its own expense and borrows to boost Moscow’s investment spending. We’ve studied how European urban agglomerations deal with this issue and we consider a trend towards targeted borrowing to be perfectly correct: loans are taken out to achieve sustainable development goals and undertake environmental projects. Moscow has a large number of green projects, most notably the construction of the Moscow Metro’s Large Circle Line, and the purchase of electric buses, environmentally friendly vehicles recognised all over the world. That is why one of our bond issues totalling 70 billion roubles will be green. Though all environmental projects in Moscow are together worth much more, our green borrowings start with this amount. Due to the current situation in the Russian green bond market, we are not expecting a greenium from investors in exchange for ESG performance, but we believe it’s right to float these bonds in Russia to promote the development of the local market. Foreign investors have already shown a lot of interest in our first bonds, which we offered for sale this week. We think green bonds will be even more in demand on an international scale, which will bring added impetus to the Russian sustainable finance market,” said Vladimir Yefimov, Deputy Mayor of Moscow, Economic Policy, Property and Land.
According to Yelena Zyabbarova, Moscow Minister and Finance Department Head, the city has been pursuing a systematic and consistent policy over the past 10 years to improve the environmental situation in Moscow and reduce the negative impact of motor vehicles on the environment. She said: “Green bonds provide a new tool to accelerate the implementation of projects helping to develop environmentally friendly public transport.
“In fact, Moscow is creating a new stock market segment in Russia by issuing the first sub-federal green bonds and participating actively in establishing an adequate regulatory framework. We are confident that Moscow’s experience and expertise in this area will be useful for other Russian regions in the future.
“We think the issuance of green bonds allows the city not only to raise funds for infrastructural projects, but also to publicly reaffirm the Moscow government’s commitment to environmentally responsible policy. As for stock market participants, they will be able to use green bonds to implement the principles of responsible investing, as well as giving support to projects to remedy the environmental situation and improve the urban environment.”
If any financial instrument is granted green status, this requires a higher level of reporting and additional measures to monitor how the proceeds from the issuance are used. The issuer should publish a special report once a year, which will be assessed for compliance with the green principles. The proceeds from the sold bonds will be used to fund the declared projects in 2021–2023.
VEB.RF’s green finance system consisting of a taxonomy for green projects, a taxonomy for intermediate (adaptational) projects, green finance guidelines and related documents is currently under consideration by the Russian Government. The system is expected to receive final approval and be ready for publication this summer.
Syndicate of VEB.RF and Commercial Banks to Provide Financing for Arctic LNG 2
- The syndicate of banks will lend 3.11 billion euros for 15 years
- Arctic LNG 2 is a major development project for Russia’s Arctic
A syndicate of VEB.RF and commercial banks—Sberbank, Gazprombank, Bank GPB International S.A. and Otkritie Bank—has signed a syndicated loan agreement with Arctic LNG 2 Ltd to carry out the Arctic LNG 2 project.
The syndicate of banks will lend 3.11 billion euros for 15 years to finance the construction of a facility designed for liquefied natural gas and stable gas condensate.
“This is an extremely important initiative in the region. The project has strategic significance for the Northern Sea Route and operations in the Arctic. VEB.RF is involved in the project in partnership with Russian commercial banks. VEB.RF has already begun financing the construction of 15 ice-class gas carriers, which will be used to transport LNG under the Arctic LNG 2 project,” said Daniil Algulyan, Deputy Chairman, VEB.RF.
“We are pleased to take part in such a large and strategically significant project as Arctic LNG 2. Sber will lend 2 billion euros for 15 years. Arctic LNG 2 will help Russia to strengthen its position in the global gas market. We find it especially important that the construction uses advanced technology that will help to minimise the environmental impact on Russia’s Arctic,” said Anatoly Popov, Deputy Chairman of the Executive Board, Sberbank.
“Gazprombank continues to be active in cooperating with Russia’s largest oil and gas market participants. We are a lender under the Yamal LNG project and we are pleased to be actively involved in another LNG megaproject implemented by NOVATEK, which is important for the socio-economic development of the entire country. I am sure the consolidated efforts of experienced, internationally recognised financial partners will ensure as much financing as necessary, and this will enable the construction to proceed at a fast pace,” said Alexey Belous, Deputy Chairman of the Management Board, Gazprombank.
“We are optimistic about the outcome of the project and we are grateful to our partners for their confidence and the opportunity to take part in the project. Low production costs, an efficient financial model and strong international investors make the project unique and truly competitive. Arctic LNG 2 is important for the Russian economy, and as a nationwide bank we are interested in its successful implementation,” said Viktor Nikolaev, Deputy President & Chairman of the Management Board, Otkritie Bank.
Arctic LNG 2 Ltd carries out a project to build three LNG trains, each with an annual capacity of 6.6 million tonnes and with a total annual capacity of 19.8 million tonnes of LNG and 1.6 million tonnes of stable gas condensate.
The project’s shareholders are NOVATEK (60%), Total (10%), CNPC (10%), CNOOC (10%), and Japan Arctic LNG and consortium of Mitsui & Co and JOGMEC (10%).
Photo courtesy of NOVATEK
The final round of the RAISE All-Russian Accelerator of Social Initiatives took place in Moscow from 20 to 22 April. VEB.RF participated in selecting the winners from among student teams of 22 Russian universities. The awards ceremony was hosted by the Russian Ministry of Science and Higher Education.
Why is it important?
RAISE is a large-scale educational programme organised by the Russian Presidential Academy of National Economy and Public Administration. The programme aims to find and teach socially oriented young leaders. Students can gain experience of preparing and implementing real social impact projects using an entrepreneurial approach. VEB.RF contributed to establishing a special category of the accelerator programme, Best Social Impact Project. Russia’s key development institution is active in promoting such projects.
VEB.RF’s Managing Director Mikhail Alashkevich said: “Social impact bonds are a new financial instrument. The government and the private investor agree to implement a project, and repayment is contingent on the achievement of specified social outcomes.
“It’s a pleasure to note that student teams of the country’s leading universities participate in our special category, coming up with ideas for social impact projects. VEB.RF is already involved in four SIB projects, and it’s very important for us to help student project teams to prepare and propose their ideas.”
Who won in the category?
The best RAISE social impact project was an initiative to improve digital financial literacy among schoolchildren aged between 14 and 17 in remote communities of the Primorie Territory. The project was prepared by the Far Eastern Federal University team. The runners-up were the students representing the Stolypin Volga Region Institute of Administration. Their team proposed a project to warn children aged 6–10 about Internet threats and teach them how to communicate on the Web.
The winners received awards from VEB.RF Director Denis Bokov
VEB.RF in Partnership with Sber and Otkritie Bank to Provide Financing for Russia’s First Green Steel Mill
- A syndicate of commercial banks and VEB.RF will provide financing for the Ecolant megaproject in the single-industry town of Vyksa, Nizhni Novgorod Region
- Central Russia will have a large gas and iron ore consumer designed for high value-added production
- The project will create over 700 permanent jobs and an additional 2,000 for the period of construction
- Ecolant is compliant with current and potential international environmental standards and consistent with the agenda for reducing the carbon footprint
VEB.RF, Sber and Otkritie Bank are to provide financing for a project to build Europe’s first large integrated steel mill compliant with environmental standards. The financing agreements were signed by Igor Shuvalov, Chairman, VEB.RF; Alexander Vedyakhin, First Deputy Chairman of the Executive Board, Sberbank; Mikhail Zadornov, President & Chairman of the Management Board, Otkritie Bank; and Ecolant owner Anatoly Sedykh. The signing ceremony took place on 20 April 2021 in Vyksa, Nizhni Novgorod Region, where the project will be built. The project initiator is Ecolant LLC. The project includes the construction of an electrometallurgical facility and the necessary infrastructure with modern technology for the manufacture of steel, bars and high-quality slabs.
The total project value exceeds 140 billion roubles. VEB.RF, Sberbank and Otkritie Bank formed a syndicate to finance the project. The project will receive financing under the Project Financing Factory programme. VEB.RF’s share in the syndicated loan is 20 billion roubles, plus a reserve tranche of 20 billion roubles. Each of the other two syndicate members is to lend an additional 40 billion roubles. The project initiator will contribute more than 40 billion roubles.
“This is a project that is consistent with the green economic development agenda. The project will create production facilities that will meet the highest environmental requirements and contribute to reducing the carbon footprint in steel production. The syndicate of VEB.RF and commercial banks will invest through the Project Financing Factory. Together with the partners and the project initiator Ecolant, we’ll lay the foundations for the long-term competitiveness of the company, the single-industry town of Vyksa and the Nizhni Novgorod Region,” Igor Shuvalov said.
“Sber pays great attention to environmental issues and, in general, the ESG-based transformation of companies and industries. We are especially interested in the Ecolant project not only because of its significance for Russian steelmaking, but also because the project involves the use of best available technology such as DRI. Compared with blast furnace technology, it can substantially reduce energy consumption and greenhouse gas emissions,” Alexander Vedyakhin said.
“A sustainable approach to business financing and support for a green economy are now as relevant as ever. As a major steelmaker, the project initiator meets high standards of quality and environmental protection; and we are pleased to expand our cooperation. The lenders and Ecolant worked closely with each other to find an optimal investment solution and structure financing in such a way as to achieve the high credit quality of the ESG-compliant deal,” Mikhail Zadornov said.
“We have vast experience of carrying out large-scale, breakthrough projects. They wouldn’t have been possible without bank lending. Ecolant is our first large investment project solely with Russian funding. Russian banks have become competitive on a global scale. One of the largest investment projects in steelmaking will be an example of how to introduce technology that can give fresh impetus to the steel industry, improve the environment in industrial areas and ensure the further development of the Russian economy,” Anatoly Sedykh said.
Ecolant is a steel mill that does not use coke or blast furnace technology. Steel will be made using direct reduced iron (DRI) from iron ore and natural gas. The project is an integrated ore-to-steel facility including DRI, electric furnace and secondary refining equipment with an annual capacity of 1.8 million tonnes of steel, and two continuous-casting machines. Production is scheduled to start in 2025. Sheet steel will be intended chiefly for the manufacture of large-diameter main pipes and ships, as well as making seamless pipes for oil production and supplying feedstock for Europe’s largest rail wheel production at Vyksa Steel Works, part of United Metallurgical Company (OMK).