Sergey Pugachev's United Industrial Corp. has found an investor to pay for the liquidation of one of Russia's largest shipbuilding companies, the Baltic Plant. Vneshtorgbank will provide the corporation with $550 million to transfer the plant's capacities to Northern Wharfs and raze the Baltic Plant to the ground in order to build elite housing and offices in its place on Vasilyevsky Island.
The 70 hectares of land occupied by the Baltic Plant is estimated to be worth $140 million. Shares in Northern Wharf will be used as collateral for the credit. VTB will thus indirectly receive control over the enterprise that Rosoboronexport tried to buy in the spring of 2006 and the state package in which will be included in the United Industrial Corp.
A member of the VTB supervisory board noted that Pugachev had tried unsuccessfully for a year to arrange the deal that is now taking place. “VTB, where [son of St. Petersburg Governor Valentina Matvienko] Sergey Matvienko works, is simply a gift for him,” the board member observed. Sergey Matvienko heads VTB Capital, a subsidiary of the bank.
United Industrial Corp. owns 72.23 percent of Northern Wharf and 80 percent of the Baltic Plant. Another 20.96 percent of Northern Wharf belongs to Rosimushchestvo, the federal property management agency. Pugachev originally suggested using money from the investment fund for the project, but that idea did not receive support. Northern Wharf will be modernized at the same time, and the project will take six years to complete.
Plans to close the Baltic Plant to build new housing and office space became known a year ago. Pugachev was to meet with Gov. Matvienko at the St. Petersburg Economic Forum in June of this year, but the city legislative assembly held hearings on the city's shipbuilding industry, at which the plans were strongly opposed by deputy presidential representative for the Northwestern Federal District, legislative assembly member and former vice president of VTB Evgeny Lukyanov, that meeting was cancelled.
The 70 hectares of land occupied by the Baltic Plant is estimated to be worth $140 million. Shares in Northern Wharf will be used as collateral for the credit. VTB will thus indirectly receive control over the enterprise that Rosoboronexport tried to buy in the spring of 2006 and the state package in which will be included in the United Industrial Corp.
A member of the VTB supervisory board noted that Pugachev had tried unsuccessfully for a year to arrange the deal that is now taking place. “VTB, where [son of St. Petersburg Governor Valentina Matvienko] Sergey Matvienko works, is simply a gift for him,” the board member observed. Sergey Matvienko heads VTB Capital, a subsidiary of the bank.
United Industrial Corp. owns 72.23 percent of Northern Wharf and 80 percent of the Baltic Plant. Another 20.96 percent of Northern Wharf belongs to Rosimushchestvo, the federal property management agency. Pugachev originally suggested using money from the investment fund for the project, but that idea did not receive support. Northern Wharf will be modernized at the same time, and the project will take six years to complete.
Plans to close the Baltic Plant to build new housing and office space became known a year ago. Pugachev was to meet with Gov. Matvienko at the St. Petersburg Economic Forum in June of this year, but the city legislative assembly held hearings on the city's shipbuilding industry, at which the plans were strongly opposed by deputy presidential representative for the Northwestern Federal District, legislative assembly member and former vice president of VTB Evgeny Lukyanov, that meeting was cancelled.