Basic Element Group, one of Russia's leading diversified business groups, Sberbank, the largest bank in Russia, and Changi Airports International, a wholly-owned subsidiary of Changi Airport Group, signed a joint venture agreement to invest in and develop airports in Russia at this past week’s St Petersburg International Economic Forum.
Under the terms of the arrangement Basic Element will hold 50 per cent plus one share, Changi Airports International (CAI) will hold 30 per cent and JSC Sberbank will hold 20 per cent minus one share in the joint venture. Basic Element will contribute to the joint venture shares of the airports in the Krasnodar region including airports of Sochi, Krasnodar, Anapa and Gelendzhik, with total assets exceeding $500 million.
According to the parties involved, the purpose of the joint enterprise is to further develop these airports in the Krasnodar region, to improve levels of service for passengers and air carriers, increase capitalisation of the assets and to also expand the portfolio of airport assets.
“We are pleased to co-operate with Sberbank and Changi Airports International,” explained Oleg Deripaska, Chief Executive officer, Basic Element. “We have already done a lot to develop airports in the Krasnodar region in the run-up to the 2014 Olympic Winter Games. In co-operation with Changi and Sberbank, we will achieve even more, turning the Krasnodar region airports - the gateways to the Sochi Olympics - into state-of the-art, highly efficient aviation enterprises. This will ensure the safety and comfort of passengers, and a quality of aircraft servicing in accordance with the highest international standards.”
Adding a financial perspective German Gref, President and Board Chairman of Sberbank, said the participation of Sberbank in this newly created joint venture is an “integral” part of its investment portfolio. “We see great potential for increased added value in the Krasnodar region airports, given the development of tourism and the upcoming sport events which will make the region the focus of international attention,” he said.
This partnership represents a strategic step for Singapore’s Changi Airports International into the Russian market. “We are glad to join Basic Element and Sberbank in the further development of the airports of the Krasnodar region. Changi brings extensive experience in managing and consulting for airports in many countries,” said Lim Liang Song, Chief Executive Officer, CAI. “Our goal is to transfer best practices in airport operations, management and development.”
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