|
|  |
| PM Russia |
|
| Summary of Proposed Investment |
| This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
| Project number | 25774 |
| Company name | PM Invest Company Limited |
| Country | Russian Federation |
| Sector | Information |
| Environmental category | C |
| Department | Global Inform. & Comm. Tech. |
| Status | Completed |
|
| Date SPI disclosed | January 12, 2007 |
| Projected board date | February 13, 2007 |
| Previous Events | Invested: May 23, 2007
Signed: March 30, 2007
Approved: March 28, 2007 |
|
| Overview |
Sponsor/Cost/Location |
Development Impact |
Contacts |
Attachments |
| Project description |
Prof-Media (or the company) is Russia’s largest diversified entertainment media group with a portfolio of assets in TV and radio broadcasting, movie production and distribution, cinema, Internet, magazines and newspapers. The company’s activities are consolidated in a sole purpose holding company, called PM Invest Company Limited incorporated in Cyprus.
To date, Prof-Media’s has grown based on an M&A strategy. Capital expenditures and acquisitions have been financed by internal cash generation and contributions from the shareholders. As the company has been relatively under-leveraged, it is seeking third-party funding to help finance its growth and repay shareholder bridge loans. IFC is contemplating to participate in the senior debt financing by providing $50 million as an anchor investor alongside a $250 million credit linked notes (the CLN) arranged by Renaissance Capital. The CLN were successfully placed within a diverse group of both Russian and international investors. |
|
| Project sponsor and major shareholders of project company |
| The company is controlled by Interros, a major Russian private investment company. |
| Total project cost and amount and nature of IFC's investment |
| The total project cost is estimated at $300 million. The proposed IFC investment is a $50 million A loan for IFC’s own account. |
| Location of project and description of site |
| Prof-Media has operating activities across Russia and some other member countries of the Commonwealth of Independent States. |
|
| Anticipated development impact of the project |
The project is expected to have the following important development impacts:
- support entertainment and new media in Russia;
- contribute to the continued growth of Russia’s advertising industry by providing an additional outlet for advertisers;
- continue to support the growth of small and medium-sized enterprises that are unable to advertise on larger broadcast stations;
- continue to develop the capabilities of local affiliates in many of Russia’s regions where development is slower;
- contribute with the development of upstream Industries and local media content and
- increase Employment. |
 |
| IFC's expected development contribution |
IFC would be playing multiple roles in this investment, including:
- providing funding to a Russian company in a sector often perceived as risky;
- encouraging the company to expand its operations into the regions to accelerate the development of the local media markets;
- providing additional comfort to investors that were coming in with a relatively new financial instrument for the Russian market (CLN); and
- encouraging other investors to participate in future funding rounds. |
| Environmental and social issues - Category C |
| This is provisionally a Category C project based on the IFC's environmental and social review procedure. Prof-Media should ensure that all operations comply with applicable environmental, health and safety laws and regulations of the Russian Federation. |
|
| For inquiries about the project, contact: |
Sergey Tikhonov, Head of Strategy and Investments
(Tel) +7 495 797 5335
(Fax) +7 495 787 5305
Email: stikhonov@profmedia.ru
Mihaly Szalontay
Associate, Investment Banking
Renaissance Capital
(Tel) +7 495 783-5678
(Fax) +7 903 758 6971
Email: msalontay@rencap.com |
|
| For inquiries and comments about IFC, contact: |
General IFC Inquiries
IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster |
|
|
|
|