Business
Acquisition of VUB
Acquisition of VUB.
About this update from Aurrigo International Plc
[{"type":"text","content":"\n Aurora Russia Limited\n21 April 2008\n\n\n \n21 April 2008\n\n\n Aurora Russia Limited's wholly owned subsidiary Flexinvest Limited\n to purchase Volzhski Universalny Bank\n\nAurora Russia Limited ('Aurora Russia'), the AIM-quoted investment vehicle\nestablished to make equity or equity-related investments in small and mid-sized\nprivate companies in Russia, announces the purchase of 100% of Volzhski\nUniversalny Bank ('VUB') through its wholly owned Cypriot holding company,\nFlexinvest Limited ('Flexinvest'). VUB is currently focused on the retail\nbanking market and is based in Samara, Russia. As at 31 December, 2007, VUB had\nRUR 263 million in assets (approximately £5.66 million) and posted a profit of\nRUR 19 million (approximately £0.41 million) for 2007.\n\n\nThe total investment of £6.36 million in Flexinvest will be used to purchase VUB\nfor £4.52 million (RUR 210 million) with the balance of £1.87 million (RUR\n87million) being invested into the bank to cover post-acquisition infrastructure\ncosts and fund ongoing operations. The deal has been approved by the Central\nBank of Russia. VUB will provide Aurora Russia with a retail banking platform\nthat will focus primarily on retail mortgages, providing synergies with\nKreditmart, the loan supermarket owned by Aurora Russia.\n\n\nThe acquisition of the banking platform will enable Aurora Russia to increase\nits presence in Russia's growing retail financial services market by\ndistributing VUB's retail products through Kreditmart, Aurora Russia's mortgage\nand consumer products financial services platform. Kreditmart will offer VUB\nmortgages, deposits, and other retail products through its distribution network\nof 10 loan shops in Russia.\n\n\nJames Cook, Director of Aurora Russia Limited, commented:\n\n'Given the Russian retail finance market dynamics and growth projections,\nacquiring a banking platform is a natural investment decision to make. We are\ngoing to seek to build synergies with Kreditmart as we believe that the\nacquisition will benefit Kreditmart's strategy to expand its cross-sell\nopportunities in insurance and wealth management. We will also expand the\nproduct range of VUB Bank to focus on mortgages and equity release products.\nThis acquisition comes at a time when the mortgage market is set to double in\nsize this year.'\n\n\nSir Trevor Chinn...