Development & Housing
"The presence of a big boss on a construction site causes disorganization and always goes hand in hand with window dressing. I don't really believe in having high-level management on-site".
Sovetsky Sport, 2009
2002 - 2010
Interros founded Open Investments, OPIN, in 2002 to consolidate its real estate assets and operations. In November 2004, OPIN became the first real estate company on the Russian market to have a successful IPO and later to have a number of equally successful SPOs. In 2008 OPIN market capitalization reached some $5.1 bln. In April 2008, business holdings were divided between Vladimir Potanin and Mikhail Prokhorov, and 27.5 percent of OPIN shares were placed under UNEXIM Group management. In September 2009, a number of OPIN projects were sold to Interros partner companies. In November 2010, all OPIN shares owned by Potanin’s entities were transferred to business entities owned by Prokhorov.
JSC Open Investments (OPIN)
- Russian real estate investment and development group.
- The OPIN portfolio includes: Pavlovo-1, Pavlovo-2, Pestovo and Martemianovo townships; the A.E. Raykin Center for Art, Culture and Leisure Commercial and Entertainment Center,
- The group owns 40,000 hectares of land lots zoned for various uses, including 605 lots (approximately 20,000 hectares) around Moscow.
Interros founds OPIN in October.
In September, OPIN is listed in group B on the RTS Stock Exchange in order to broaden the number of potential investors before an IPO. OPIN’s November IPO is a success, raising $68.8 mln from a large pool of investors. This makes Open Investments the first publicly-traded company on the Russian real estate market. The IPO also allows it to raise funds for its commercial real estate and housing projects. Company shares are included in the RTS and RTS-2 indices.
2006 – 2007
- In April 2006, the company finalizes its second secondary public offering totaling approximately $90 mln
- In October 2006, the third secondary public offering of 4,875,488 shares brings in approximately $881 mln
- In May 2007, an additional 1,798,063 shares are issued in the amount of $325 mln
- In October 2007, the fifth secondary public offering totaling 2,038,930 shares brings in approximately $591 mln
In April, 27.5% of OPIN shares are transferred to UNEXIM Group management while business holdings are divided between Vladimir Potanin and Mikhail Prokhorov. In May, market capitalization reaches $5.1 bln.
In September, OPIN shareholders fail to reach an agreement on how to best address the company’s financial troubles. OPIN offers its shareholders the opportunity to buy some of the company’s assets. In the end Interros partner companies acquire a number of assets, including Domnikov and Meyerhold Business Centers, Novotel, and the Bolzhoe Zavidovo and Pavlovo Podvorie Development Projects. OPIN uses the funds from the sale to meet its debt obligations and continue operations, thus avoiding bankruptcy.
In November, after a series of deals to unwind the trust, all OPIN shares owned by Vladimir Potanin’s business entities are transferred to companies owned by Mikhail Prokhorov.
2003 - 2007
Novogor - Prikamyewww.novogor.perm.ru
Interros founded NOVOGOR-Prikamye in 2003 to manage public utility services and other housing amenities in the Perm region. The company upgraded Perm’s water supply and wastewater treatment plant and restructured municipal utility service providers in the town of Berezniki. In 2005 Perm and Berezniki utilities were placed under NOVOGOR-Prikamye management, and the following year Perm’s municipal authorities approved the Integrated Water Supply and Wastewater Disposal System Development Program for the city of Perm through 2025, a program that had been developed by the NOVOGOR-Prikamye shareholders and the executive team. Interros demonstrated that housing services and public utilities can be a promising area for investment. In 2007 Interros sold the company to Viktor Vekselberg’s KES Holding for approximately $50 mln.
- A municipal utilities company providing consumers with water, electricity, heat and wastewater treatment and disposal.
- The first private company in the public utilities sector in a Russian city with a population of over 1 mln people.
Interros creates NOVOGOR-Prikamye in 2003 to manage municipal utility and other public services in the Perm region. The company becomes the first private entity to manage a municipal public utility in a Russian city with a population of over 1 mln people. NOVOGOR-Prikamye CEO Mikhail Nikolsky gathers a team of professional executives for the task.
In July Interros signs a cooperative agreement with the Perm oblast administration.
- Perm water supply and waste water treatment plant upgrade
- Restructuring the municipal public utilities in Berezniki
In October, NOVOGOR-Prikamye signs a short-term agreement with Perm municipal authorities to lease the Perm water supply and wastewater treatment plants. Operations begin in December. While the short-term agreement is in force, NOVOGOR-Prikamye works with Severn Trent Water International Ltd, a British water supply and wastewater treatment holding company, to design a strategy for Perm water supply and wastewater treatment through 2020.
NOVOGOR-Prikamye presents draft projects to Perm administration to the tune of more than $300 mln:
- Draft long-term property lease agreement
- Draft development strategy for water supply and wastewater treatment
- Draft new rate agreement
- Draft investment program to rebuild, upgrade and retrofit the water supply and wastewater treatment system in the city of Perm
NOVOGOR-Prikamye is to manage municipal utilities in Perm and Berezniki:
- In Berezniki, the company wins an open tender to lease utility systems that provide the town with heat, electricity, water and wastewater treatment facilities.
- In Perm the company signs a long-term (49-year) agreement with Perm municipal authorities to lease the Perm water supply and wastewater treatment plant. NOVOGOR-Prikamye conducts regular opinion polls to evaluate public perception of the company, and then submits poll results to municipal authorities. In the summer, NOVOGOR-Prikamye acquires a 100% stake in the Biological Treatment Facilities company from the Perm municipal administration and integrates it as plant workshop #17. This creates a fully integrated closed wastewater treatment cycle.
In the spring, NOVOGOR-Prikamye makes the first calculation of the integrated efficiency parameters based on 2005 data for the Perm water supply and wastewater treatment plant, and submits the results to Perm municipal authorities. In the fall, the Perm municipal Duma approves the Integrated Water Supply and Wastewater Treatment Development Program system in the city of Perm through 2025 as developed by the NOVOGOR-Prikamye executive team and shareholders together with COWI International and the Urban Economy Institute foundation (Moscow).
The Program calls for:
- An action plan to improve and develop the water supply and wastewater treatment system in Perm with a view towards urban development and projected changes in water consumption and wastewater treatment needs
- An action plan to decrease the environmental burden
- Rate and investment policy
In December, NOVOGOR-Prikamye signs a 30-year long-term agreement with the Berezniki municipal authorities to lease municipal property, namely communal heating systems, electricity supply, water supply and wastewater treatment facilities. Additionally, the company begins to operate the water supply and wastewater treatment system in the town of Krasnokamsk in the Perm region.
NOVOGOR-Prikamye is a successful, rapidly growing company that uses modern methods to manage municipal utilities. The company has become an attractive acquisition target. Interros accepts an offer from Viktor Vekselberg’s KES Holding to buy NOVOGOR-Prikamye for some $50 mln.