Texas-based TPG has bought a significant minority stake in Russian hypermarket chain Lenta in conjunction with Moscow's VTB Capital. Putin at the VTB forum
VTB Capital today revealed the deal had closed, with the Russian firm and TPG now owning 35.4 percent of Lenta, which operates 36 hypermarkets in Russia making the chain one of the largest retail operators in the country. Fourteen of the stores are located in St. Petersburg. None are in Moscow.
In a statement, the Russian firm, which is owned by VTB Bank, said it would work with TPG to “come to a joint viewpoint with respect to the long-term strategy” of developing Lenta in the Russian retail market, especially in the regions.
“The investors intend to maximize the shareholder value of the company by improving operational management and strengthening the system of financial control,” added VTB.
Yuri Soloviev, president of the firm, said it was important for VTB Capital to participate in investment projects in “socially significant spheres” of the Russian economy, particularly in retail businesses.
Putin used his speech at VTB’s forum to say Russia would not revert to the past and would remain a liberal market economy.
“Today, I want to repeat that we will consistently promote private enterprise, the country`s integration into the global economy and will also do our best to create a favorable investment climate,” he said.
“We certainly call on businesses to more actively invest in Russia`s regions. Do not stay in the same place, where there is often not enough room for everyone, but consider the regions that are not spoiled with overinvestment and where it is possible to take advantage of optimum business conditions,” he said. “There are, in fact, examples of large 100 percent foreign capital-based enterprises being created and successfully operating in many regions.
The strategy of Lenta opening additional hypermarkets in the regions seems to be compatible with Putin's call. The chain sells Russian goods.
“Allow me to draw your attention to the fact that retired Russians never buy expensive imported goods. This group usually opts for Russian products,” Putin said at the forum.
Putin at the VTB forum