The Hindu Business Line : Srei Infra inducts new partners into Russian arm

The London-based European Bank for Reconstruction and Development (EBRD) and DEG of Germany have signed for a 30 per cent stake in Srei Infrastructure Finance Ltd's Russian venture Zao Srei.

As a result, the equity share capital of Zao Srei will stand increased from the existing $4 million to $5.7 million. Both EBRD and DEG will take 15 per cent each of the expanded capital.

Srei Infrastructure had only recently entered into an alliance with EBRD for expanding the operations of Srei's Russian outfit. The alliance also includes a credit line from EBRD to the tune of 5 million, over and above the equity support, which is now in place.

Multilateral Funding

The agreement was signed on Friday at the Monolith Club in Moscow by Mr Milton Stefani, Senior Vice-President of EBRD; Dr Volker Neuschutz, Head of DEG's representative office in the Russian Federation; and Mr Hemant Kanoria, Vice-Chairman and MD of Srei Infrastructure Finance, heralding the induction of new equity partners into the Russian company.

Commenting on the deal from Moscow, Mr Hemant Kanoria said: "The entry of EBRD and DEG will increase the level of Srei's involvement in Russia as well as enable Zao Srei to grow at a faster pace."

According to him, Srei's current growth graph now stands well delineated, given the company's firm linkages and relationships with the multilateral funding agencies, vendors and home experience.

He said having set up operations in Russia in the second half of 2005, Srei has chalked out plans to scale up businesses through speedy entry into the infrastructure space in the region, which is now experiencing a boom. The company's immediate plan, according to Mr Kanoria, is to extend presence from Moscow to St Petersberg and other regions in Russia.

More Stories on : Mergers & Acquisitions | NBFCs | Infrastructure

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