The investment, which was announced during the APEC Summit, will create jobs in the Russian Far East and introduce advanced technology into the Russian timber industry
Vladivostok, September 07, 2012 – Russian Direct Investment Fund announced today that Russia-China Investment Fund (RCIF) has reached a preliminary agreement to become a shareholder of Russia Forest Products (RFP), Russia’s second-largest forestry company.
RCIF’s investment will fund the Company’s move up the value chain from producing primarily raw logs to higher value added products like veneer and sawnwood. Completion of the transaction is subject to the satisfactory completion of regulatory approvals, as well as final approval according to corporate procedures of RCIF.
“This transaction ideally fulfills the mission of the Russia-China Investment Fund: we expect it to generate strong returns as well as to advance bilateral economic cooperation between Russia and China, -- said Kirill Dmitriev, Chief Executive Officer of the Russian Direct Investment Fund. – As a result of this transaction RCIF may invest over 200 million dollars in RFP and become the largest single shareholder of the company. This investment will lead to creation of new jobs throughout Russia’s Far East and implementation of modern technologies in Russian forestry sector.”
Russia Forest Products, based in the Russian Far East, is a leading producer of wood and wood products. The Company holds annual allowable cut rights of over 4.5 million cubic meters and maintains long-term leaseholds on 6.4 million hectares of forest. Russian Forest Products sells most of its production to China, and the Company accounts for approximately 10% of total timber export from Russia to China.
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Russian Direct Investment Fund (RDIF), established in June 2011, is to be capitalized with USD 10 billion in Russian government funds to make equity investments that generate strong returns. In each investment it makes, RDIF is mandated to secure co-investment that as a minimum matches its commitment, thus acting as a catalyst for direct investment into the Russian economy. Additional information is available at www.rdif.ru.