Despite new-start Business Alliance reporting losses, it has
secured deals with Russian blue-chips and is financing more large
assets
Business Alliance (BA) is regarded as one of the
fastest-growing leasing companies in Russia. Well known for its
niche leasing services for Russia’s energy sector, BA is majority
held by VI-Trade (Overseas) Ltd Cyprus, an affiliate of Otkrytie
Investment Group, which has 75 per cent of its stock less two
shares. The remainder of the company is distributed equally between
BA’s general director, Alexei Akindinov, and deputy general
director Anna Fedorova.
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Founded in 2006, BA has been able to rapidly secure deals
with Russian blue-chips. Last year, it wrote a deal with the Moscow
United Electricity Distribution Company for the leasing of cable
lines, substations and other equipment worth approximately $440m
(about €282m).The deal was executed with funds from the Bank of
Moscow, which remains BA’s principle funder. Lease payments from
this deal were subsequently realised upfront through a Eurobond
issue – believed to be the second securitisation of lease deals
originated in Russia after the Red Arrow rolling-stock
securitisation.
BA provides customers with turnkey solutions, assisting them in
assembly and start-up operations of their projects. These services
range from dealing with creditors, suppliers, insurers, logistics,
customs clearance, business-plan auditing, certification and tax
consulting.
The company does not publicly release its accounts, but it says
that, under IFRS accounting rules, it reported a profit in the
financial year ended 31 December 2007. It reports a lease portfolio
of RUB57.1bn (€1.5bn), representing a 114 per cent increase on the
previous year. In 2006, BA reported a loss of RUB22.1m (€593,852)
under IFRS, total assets of RUB5.2bn (€139m) and total equity of
RUB27m (€725,418).
“For this year, our plans are to retain rate of growth and
enlarge our activities in the field of rail transport, real estate
and telecommunication. We started to work in these segments with
big deals last year and showed we can work not only in the power
industry,” the company said.
For as long as global financial markets remain in turmoil, BA
says it will be difficult to tap the capital markets for liquidity
management. “As soon as this global credit crunch is over,
securitisation as a part of our funding [strategy] will be back,”
the company said.
