Siberian Aluminum chief Oleg Deripaska together with Sibneft chief Roman Abramovich has extended his industrial empire by taking over top-10 bank Avtobank and leading insurer Ingosstrakh, sources familiar with the deal said Thursday.
None of the companies would confirm the acquisition. But the sources said it's a done deal and value it at $90 million.
Along with Avtobank and Ingosstrakh, SibAl and Sibneft are buying Nosta Metals Plant, the sources said.
Such a deal would be beneficial for all sides, said Mikhail Matovnikov, deputy director of Interfax Rating Agency. "SibAl could get Avtobank, Ingosstrakh and [its affiliate] Ingosstrakh-Soyuz -- immediately a bank-insurance empire," he said. "Avtobank has a fairly good reputation."
The possible acquisition comes a year after SibAl took over the Gorky Automobile Plant -- a strategic partner of both Avtobank and Ingosstrakh.
An Avtobank spokesman said it was holding talks with downstream oil company Nafta-Moskva, which is believed to be a go-between for SibAl.
Nafta-Moskva has lost its main strategic partner -- No. 3 oil producer Surgutneftegaz -- and could be looking for a new alliance.
Ingosstrakh is holding talks on a strategic partnerhip with both Nafta-Moskva and SibAl itself, said Tatyana Grosheva, a spokeswoman for the insurance company.
Although SibAl is allied with MDM Bank, the metals major may be looking for a bank it can directly control, analysts said.
Furthermore, SibAl would be able to easily settle GAZ's debt to Avtobank. Ownership of GAZ also would help SibAl take control of Avtobank for a relatively low price.
"SibAl became a major borrower of Avtobank through its subsidiary GAZ. This is a significant factor that could allow SibAl to bargain for very good terms for a bank that urgently needs to sell a stake," said Matovnikov.
GAZ is in the process of restructuring its debts and would not comment on its debts to Avtobank.
A takeover by SibAl would also be advantageous for Avtobank -- which may be looking for a powerful ally in its fight against Alfa Group over Nosta.
Nosta, which owes Avtobank 234 million rubles ($8 million), is now under temporary bankruptcy management. Alfa is the manager.
"A strategic partnership could help change Avtobank's situation," Matovnikov said. "Avtobank will probably not recover its loans to Nosta if it is bankrupted. This would leave a huge hole; about 17 percent of its capital would disappear," he said.
"The situation is extremely unstable for the bank. In order to get out of it, the bank will need a way to put up resistance -- most likely against Alfa Group -- to avoid losing a large chunk of its assets."
Deripaska may have struck a deal with Andrei Andreyev -- the former chairman of Nosta's board of directors who reportedly controls Avtobank -- to sell off shares in the bank and Ingosstrakh, Matovnikov said. Andreyev nominally owns a tiny stake in both companies.
In a report, the RusRating agency confirmed it was likely that Andreyev passed control to Deripaska through an intermediary.
RusRating published a report Thursday lowering Avtobank's rating by two notches to CC from B -- already fairly low. The agency had frozen the bank's rating and began investigating the change in real ownership in September. "The lower rating reflects not only the uncertainty over ownership, but also basic economic fundamentals," said Richard Hainsworth, head of RusRating. "Avtobank is in a position to overcome their difficulties if management and ownership are committed to Avtobank's remaining a going concern."