Siguler Guff Buys Into Russia’s MDM Bank

Siguler Guff has acquired a minority equity stake in MDM Bank, one of Russia’s largest private banks, for an undisclosed amount. Brunel Capital served as broker. MDM was formed this past August via the merger of URSA Bank and MDM-Bank.

PRESS RELEASE

Brunel Capital, a boutique advisory and M&A firm, has successfully brokered sale of a minority stake in MDM Bank to Siguler Guff (SG), a major New York-based private equity firm. MDM is one of Russia’s largest private banks.
 
The agreement marks the first significant foreign investment in the Russian financial sector since the onset of the financial crisis. SG will join a number of other international investors in MDM, such as the European Bank for Reconstruction and Development, the International Financial Corporation and DEG.
 
 “We are proud we were able to help MDM enhance its shareholder structure and assist the bank in continuing its spectacular growth“, said Brunel Capital’s CEO Max Atanassov. “We were confident that even in this difficult economic climate, good assets can attract quality investors. We are convinced that investors such as Siguler Guff can add value to MDM.”
 
Added Ashot Ter-Avanessov, Brunel’s Head of Private Equity and Financial Advisory: “We are pleased that we can bring an investor with a long-term view into partnership with MDM. The deal demonstrates that strategically minded investors can find good deals and that Russia and its financial sector can offer attractive investment opportunities. We believe that good corporate governance and modern management are essential for those companies that seek to attract international investors.”
 
MDM Bank was formed through the merger of URSA Bank and MDM-Bank in August 2009. It is among the largest in the country in terms of equity capital and assets. The major shareholders in MDM Bank are Sergey Popov, who owns 54.1%, and Igor Kim, with 10.5%.

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ABOUT BRUNEL CAPITAL
Brunel Capital Limited is a financial advisory and mergers and acquisitions firm based in London. It has been involved in projects in Europe, North America, Asia and Australasia. Brunel Capital is authorised and regulated by the Financial Services Authority. Web site: www.brunelcapital.com <http://www.brunelcapital.com> .

ABOUT SIGULER GUFF
Siguler Guff and Company is an international firm that manages direct investment funds, with assets of over $8 bn. It is headquartered in New York. SG is a leader in managing private equity investments in emerging markets. The company has had a presence in Russia and the CIS since 1994 through its investment arm, Russia Partners.

ABOUT MDM BANK
MDM Bank is a leading independent provider of banking services in Russia, comprised of two main banking units: Corporate Banking & Investment Banking (CIB), which encompasses Corporate Banking, Investment Banking, Financial Markets, Private Banking, Asset Management and Leasing; as well as Retail Banking, which includes Consumer and Small Business Banking. Approximately half of Russia’s top corporations are MDM Bank clients, and for individual clients and small business banking, MDM Bank provides a network of over 350 points-of-sale in 160 cities. Established in 1990, MDM Bank is currently one of Russia’s largest privately owned financial institutions in Russia. Its financial strength is underscored by credit ratings <http://www.mdmbank.com/about/ratings> : MDM Bank has some of the highest credit ratings among privately-owned Russian banks. It has received a wide range of industry awards <http://www.mdmbank.com/about/awards>  and employs over 10,000 people.