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Sistema

AFK Sistema PAO is a large Russian conglomerate company, founded by Vladimir Yevtushenkov, who was chairman of the corporation's board of directors until 2022. In April, Yevtushenkov's shareholding in Sistema decreased to 49.2%, and he also stepped down from Sistema's board of directors.[1][2]

Sistema has its headquarters in Moscow. The company's global depository receipts (GDRs) traded on the London Stock Exchange from 2005 until delisting in May 2023.[3] It has been under US sanctions since November 2023.[4]

History

In 1993,[5] Evgeny Novitsky and Vladimir Yevtushenkov founded the holding company AFK Sistema, also known as Sistema JSFC, to group together several information technology (IT) and cell phone companies including MTS.[6][7][8][9]

Structure

Sistema operates several consumer service businesses in the areas of:

In November 2021, "Sistema" was included in "Khabarovsky Project" (in Khabarovsk Krai) for pilot production of green hydrogen with a projected 350 thousand tons per year, according to Ministry of Industry and Trade (Russia).[20]

  • IT and telecoms — Mobile TeleSystems, Moscow City Telephone Network, SkyLink, Sitronics (formerly known as 'Science Center Concern'), NIIME, Mikron, STROM telecom.[11]
  • Banking — MTS Bank, East-West United Bank
  • E-commerce – Ozon
  • House-Building and Real Estate — Sistema-Gals till the end of 2010.[12] In February 2019, Sistema became the largest shareholder of Etalon Group[13]
  • Retail — Detsky Mir Group until September 2020[14]
  • Media — Sistema Mass Media until 2016[15]
  • Healthcare and Pharmaceuticals — Medsi, Binnopharm[16]
  • Agroholding - Steppe, which, according to Forbes in June 2019, is the second largest land bank in Russia. It has holdings in Rostov Oblast and Stavropol Krai.[17][18]
  • Segezha Group, a vertically integrated holding company in the timber industry, performs a full cycle of operations from logging to advanced wood processing
  • Hospitality – Cosmos Hotel Group
  • Other businesses — Intourist (Travel Services), until July 2021 RTI Systems (Radio and space technology), Olympic Sistema (Sport)
  • Kronstadt Group until July 2021. In addition, on 07.27.2021, AO Kronstadt acquired 80% of the shares of NPP Strela (Research and Production Enterprise, Bykovo, Moscow Region), engaged in helicopter-type UAV work.[19]
  • The corporation also invests in innovation projects, such as green hydrogen, and venture businesses.

Interests and subsidiaries

Banking

In February 2005, AFK Sistema owned a 49% stake in East-West United Bank (Luxembourg), which was established in June 1974 as a "daughter" bank of the Central Bank of Russia and is one of the five Russian foreign banks of the VTB network.[21][22][23][24] In 2018, Sistema held a 100% stake in East-West United Bank (EWUB) with Sergei Pchelintsev as the CEO.[33][34] In 2021, the company's revenue amounted to 24 billion rubles.[35]

Following the February and March 2022 sanctions issued against VTB and its subsidiaries which include the former daughter banks of the Soviet Union's State Bank Gosbank and later the Central Bank of Russia, EWUB in Luxembourg has become the principal Russian overseas bank in Europe after Gazprombank ceased operations in the region.[36][37] As of the end of March 2022, the Vladimir Yevtushenkov (в) controlled Sistema and its subsidiary East-West United Bank (EWUB) in Luxembourg have not been sanctioned due to Russian invasion of Ukraine.[36][38][39] He no longer controls Sistema after reducing his stake in the corporation below control (49.2%), and voluntarily resigned from its board of directors in April 2022.[40][41]

Hotels

According to Arnold Tamm (Spivakovsky), both the Peking Hotel at Bol'shaya Sadovaya Ulitsa, 5 in Moscow, where Oleg Kuznetsov was the administrator from 2002 to 2016, and the Cosmos Hotel at 150 Mira Avenue in Moscow, are owned by Sistema.[44]

Aerospace and defence

Until July 2021[54] AFK Sistema PAO had an aerospace and defence subsidiary, Kronstadt Group, which was acquired in 2015 and developed uncrewed aerial vehicles, and flight simulators. AFK Sistema no longer controls any assets related to the defense industry.[54]

Bashneft interest seizure and Rosneft lawsuit

In 2014, 72% of Sistema's interest in Bashneft was seized by the Russian government.[55][56]

On 3 May, 2017, Sistema shares plunged about 37% following a $1.9 billion lawsuit filed by Rosneft.[57]

On 15 May 2017, the Arbitration Court of Bashkortostan registered a RUB 106.6bn claim filed by Rosneft and Bashneft against Sistema, a preliminary hearing of the case was scheduled for 6 June, Irina Nurislamova was appointed as a judge for the case.[58][59]

In December 2017, AFK Sistema reached an amicable agreement with Rosneft and agreed to pay out 100 billion roubles ($1.7 billion) to resolve the dispute.[60]

According to a declaration given on 18 October 2018 in a Spanish court by Sergey Dozhdev, Igor Sechin uses his offshore companies to control Sistema through MTS and Bashneft.[44][49]

Management

On 27 June 2020, Etienne Schneider became an independent director of Sistema, at which his close political friend Jeannot Krecké had been a director at Sistema since May 2012.[7][24] Positions they resigned in February 2022.

External links

References

  1. Ad-Hoc Notice sistema.com^
  2. Sistema announces decisions of the Board of Directors sistema.com^
  3. "Система" провела делистинг с LSE Интерфакс, 2023-05-17^
  4. Russia-related Designations, Updates and Removal; Counter Terrorism Designation Update; Issuance of Russia-related General Licenses United States Department of the Treasury, 2023-11-02^
  5. In 1993 Sistema JSFC was founded and acquired its first assets sistema.com^
  6. Yevgeny Grigoriyevich Novitsky Bloomberg, retrieved 3 August 2021^
  7. Sistema Board Recommends to the AGM to elect three new Independent Directors AFK Sistema, 31 May 2012, retrieved 3 August 2021^
  8. David Hoffman. In Moscow, Business and Politics Mix The Washington Post, 19 December 1997, retrieved 3 August 2021^
  9. About Sistema: Success Story (history) Sistema website, retrieved 3 August 2021^
  10. Myroslav Demydenko. Ukraine, Vanco Energy, and the Russian mob Eurasia Daily Monitor Volume: 5 Issue: 177, 16 September 2008, retrieved 16 September 2021^
  11. Феликс Евтушенков увеличивает инвестиции в стартапы CNews.ru, retrieved 2023-03-24^
  12. О продаже 27,6% "Системы-Галс" АФК "Система" сообщила в пятницу. Покупателями выступили компании Blairwood Ltd. и Stoneflower Ltd, каждая из которых получила по 13,8%. Сумма сделки составила $70 млн. www.kommersant.ru, 6 December 2010^
  13. АФК "Система" приобрела 25% акций группы Etalon у семьи основателя девелопера Вячеслава Заренкова. После сделки у нее осталось 5,7% Etalon, а АФК "Система" стала крупнейшим акционером группы www.vedomosti.ru, 20 February 2019^
  14. АФК "Система" перестала быть акционером "Детского мира": компания продала свою долю почти за 17 млрд рублей www.forbes.ru, 2 September 2020^
  15. АФК «Система» продаст свои медиаактивы. Уже в начале 2016 года подконтрольная корпорации компания СММ будет преобразована в фонд прямых инвестиций, который займется инвестированием в технопроекты. www.rbc.ru, 25 December 2015^
  16. Евтушенков Владимир: "Эпидемия коронавируса — это общая проблема и касается всех без исключения" Ридус, retrieved 2023-03-21^
  17. Alternate archive Игорь (Popov, Igor) Попов, Анастасия (Lyalikova, Anastasia) Ляликова, Максим (Pleshkov, Maxim) Плешков. Хозяева земли русской: 20 самых дорогих землевладений России. Рейтинг Forbes Forbes, 17 June 2019, retrieved 29 March 2022^
  18. АФК «Система» уходит в АПК: С 2011 года в российском агропромышленном комплексе появился новый активный игрок - Акционерная финансовая корпорация «Система», которая на протяжении пяти лет непрерывно наращивает своё присутствие и расширяет сферу деятельности в этом направлении. agroxxi.ru, 9 July 2016, retrieved 29 March 2022^
  19. Блог Missiles.ru - Беспилотные “Стрелы” вертолетного типа. 10.10.2021г.^
  20. АФК Система включена в хабаровский проект по производству зелёного водорода Интерфакс, 2021-11-17^
  21. "Дочерние" российские зарубежные банки и сеть ВТБ: доли ЦБ, ВТБ и др. compromat.ru, February 2005, retrieved 15 July 2021^
  22. Александр (Birman, Alexander) Бирман. В советских сетях: Нефтедоллары пойдут по проверенным каналам загранбанков Компании Деловой Еженедельник (ko.ru), 21 February 2005, retrieved 15 July 2021^
  23. Les 45 ans d'East-West United Bank célébrés paperjam.lu, 19 September 2019, retrieved 3 August 2021^
  24. Étienne Schneider élu administrateur chez Sistema paperJam (paperjam.lu), 3 July 2020, retrieved 3 August 2021^
  25. East-West United Bank (EWUB). Our History: Ownership History East-West United Bank S.A., April 2022, retrieved 5 April 2022^
  26. East-West United Bank (EWUB). Our History: Ownership History East-West United Bank S.A., April 2022, retrieved 5 April 2022^
  27. USMAN SABIR. SUBSIDIARY BANK OF SISTEMA PJSFC: EAST-WEST UNITED BANK IN LUXEMBOURG International Press Service News Agency (IPS) (ipsnews.net), 14 May 2021, retrieved 5 April 2022^
  28. "Дочерние" российские зарубежные банки и сеть ВТБ: доли ЦБ, ВТБ и др. compromat.ru, February 2005, retrieved 5 April 2022^
  29. Александр (Birman, Alexander) Бирман. В советских сетях: Нефтедоллары пойдут по проверенным каналам загранбанков ООО Журнал «КО» (ko.ru), 21 February 2005, retrieved 5 April 2022^
  30. Виктор (Yuryev, Viktor) Юрьев. ВСЕМИРНАЯ ИСТОРИЯ БАНКРОТСТВ-3: Новое руководство "Империала" возвращается на рынок банковских операций Nezavisimaya Gazeta (ng.ru), 26 May 2000, retrieved 5 April 2022^
  31. Александр (Sedunov, Alexander) Седунов. 25 лет Всемирной Истории с Банком Империал Information Agency InterRight, 17 August 2015, retrieved 5 April 2022^
  32. letopis.org staff. Столяренко, Владимир Михайлович АНО «Экономическая летопись» (letopis.org), February 2020, retrieved 5 April 2022^
  33. EWUB – история ewub.lu website, retrieved 3 August 2021^
  34. Управляющие директора ewub.lu website, retrieved 3 August 2021^
  35. ПАО АФК "Система" www.rusprofile.ru, retrieved 2023-10-27^
  36. Marc Fassone. SANCTIONS AGAINST RUSSIAN INTERESTS: East-West United Bank is in the clear for now Delano (delano.lu), 28 February 2022, retrieved 26 March 2022^
  37. Shivam Mishra. Russia's Gazprombank to cease operation in Switzerland Retail Banker International, 2022-10-11, retrieved 2023-05-24^
  38. Karin Strohecker. Explainer: How Western sanctions target Russia Reuters, 25 February 2022, retrieved 26 March 2022^
  39. Louis Auge. Russian oligarch who makes drone bombers to destroy Ukraine still not sanctioned: Evtushenko Makes Putin's Weapons. As the West looks to impose further sanctions on Russia and President Vladimir Putin's cronies more targets are being added to the "blacklist". Planes, boats and bank accounts - the prized assets of oligarchs around the world - are being squeezed tighter and tighter by a relentless America, United Kingdom, and EU. However, one billionaire appears to have slipped through - so far. EU Reporter (eureporter.co), 23 March 2022, retrieved 31 March 2022^
  40. Евтушенков сократил долю в АФК "Система" ниже контроля на фоне британских санкций www.interfax.ru, 13 April 2022^
  41. Владимир Евтушенков вышел из совета директоров АФК "Система" www.interfax.ru, 15 April 2022^
  42. Alt URL Елена (Skvortsova, Elena) Скворцова. Кража века: 11 лет назад в Питере украли рукописей почти на 150 миллионов долларов. Тогда это называли "делом Якубовского" «Собеседник» (sobesednik.ru), 18 January 2006, retrieved 29 March 2022^
  43. Александр (Khinshtein, Alexander) Хинштейн. Солнцевское затмение 2 Московский комсомолец, 3 June 2002, retrieved 29 March 2022^
  44. Анастасия (Anastasia, Kirilenko) Кириленко. On the death of Tamm: Solntsevskaya gang's ties to FSB and United Russia The Insider (theins.ru), 2 April 2019, retrieved 29 March 2022^
  45. Alt URL Archived as "Газпромовские" круче "солнцевских": "Правая рука" Михася Арноша Спаваковский может не дожить до суда ("Gazpromovskie" is cooler than "Solntsevo": "Right hand" Mikhas Arnosh Spavakovsky may not live to see the trial). Дмитрий (Starostin, Dmitry) Старостин. Кокаин и "Газпромнейт" «Вести.Ру» (vesti.ru), 24 March 2002, retrieved 29 March 2022^
  46. Archived as Арноша (Спиваковский) подсаживал танцовщиц из стриптиз-клуба Dolls на кокаин (Arnosha (Spivakovsky) hooked dancers from the Dolls strip club on cocaine). Александр (Khinshtein, Alexander) Хинштейн. Солнцевское затмение Московский комсомолец, 31 May 2002, retrieved 29 March 2022^
  47. Alternate archive DAMIÁN RUIZ FÁJULA. La Guardia Civil estrecha el cerco a la mafia rusa en la Costa del Sol El Mundo, 26 September 2017, retrieved 29 March 2022^
  48. Patricia Ortega Dolz. La silenciosa mafia rusa: así opera en España. Oligarcas amparados por Putin se han asentado por el territorio con millones de euros del crimen organizado o de empresas estratégicas privatizadas tras caer la URSS El País, 28 March 2022, retrieved 29 March 2022^
  49. Sergey Dozhdev's statement on Gref and Sechin – Spain Transborder Corruption Archives (tbarchives.org), 17 October 2018, retrieved 29 March 2022^
  50. Report on the SOLNTSEVSKAYA criminal organization Transborder Corruption Archives (tbarchives.org), 5 November 2018, retrieved 29 March 2022^
  51. Report on the SOLNTSEVSKAYA criminal organization Transborder Corruption Archives (tbarchives.org), 18 October 2018, retrieved 29 March 2022^
  52. Spanish police arrest Estonian head of Russian mafia group Baltic Times, 29 September 2017, retrieved 29 March 2022^
  53. В Испании пока не выяснили причину смерти бывшего гражданского мужа Лолиты RIA Novosti, 13 March 2019, retrieved 29 March 2022^
  54. АФК "Система" больше не контролирует два актива, связанных с оборонной промышленностью – концерн "РТИ" и группу "Кронштадт". 15 July 2021^
  55. Sistema Shares Soar as Putin Says Evtushenkov Charges Not Proven December 18, 2014, retrieved December 27, 2014^
  56. Even Loyalty No Guarantee Against Putin The New York Times, December 26, 2014, retrieved December 27, 2014^
  57. Sistema shares plunge a third after $1.9 billion Rosneft lawsuit Reuters, 2017-05-03, retrieved 2017-05-04^
  58. Предварительное заседание суда по иску "Роснефти" к АФК "Система" назначено на 6 июня Ведомости, 15 May 2017^
  59. "Система" не признала обвинения "Роснефти" Ведомости, 18 May 2017^
  60. Russia's Rosneft reaches $1.7 billion settlement with Sistema Reuters, 22 December 2017^