State-owned VTB bank is creating Russia's largest property developer to consolidate and manage construction assets the bank received during the global financial crisis, Vedomosti business daily quoted sources as saying on Wednesday.
The new company could become Russia's largest developer if it consolidates the assets of VTB-Development, a VTB developer subsidiary, the paper quoted a bank manager as saying.
"If we add up all the assets, it will be Russia's largest company by volume of land and projects," Knight Frank Senior Vice President Andrei Zakrevsky said.
Pavel Kosov, vice president in charge of granting loans to developers, will supervise the establishment and staff recruitment. The developer has already hired 40-50 people.
VTB did not confirm the reports, but a source close to VTB told Vedomosti that the company was being created on the basis of DKS, formerly part of Don-Stroy. The source added that the bank intended for the new company to manage all of VTB's construction projects.
VTB now holds assets in several construction companies, which failed to repay their debts due to the economic crisis.
The bank bought 51 percent of Sistema-Hals, a construction business belonging to Vladimir Yevtushenkov's AFK Sistema holding company, for 60 rubles ($2), while Sistema-Hals' debt amounted to 23.5 billion rubles.
VTB now holds a controlling stake in the Dynamo football club with a construction project of a new stadium and multi-functional centers with an overall space of 937,000 square meters.
The bank has also acquired 50 percent plus one share in Don-Stroy Invest, which owns all Don-Stroy's construction projects. The bank also received 1,200 hectares of land in the Odintsovo district in Moscow region.
Vedomosti quoted a VTB top manager as saying that VTB had so far made no final decision on the creation of the new company, but the inclusion of VTB Development in the project seemed logical. VTB Development manages construction projects in St. Petersburg, which VTB launched before the financial crisis.
VTB plans to build offices, apartment houses and trading stores, unlike such market leaders as SU-155 and PIK Group, which focus on residential property.
MOSCOW, August 04 (RIA Novosti)