FIMBank plc - Factoring Joint Venture in Russia

On 16 November FIMBank plc announced that a Shareholders’ Agreement and Subscription Agreement have been entered into between FIMFactors BV (a fully owned subsidiary of FIMBank plc), CIS Factors Holding Company BV (CIS), Transcapitalbank and the International Finance Corporation (IFC). FIMBank explained that these Agreements pave the way for the setting up of CIS as a joint venture holding company to carry out the business of factoring in Russia through a company to be incorporated under the name FactorRus. CIS is being set up under the laws of the Netherlands and will own FactorRus. In this joint venture, FIMFactor’s partners are Trancapitalbank and the IFC. Transcapitalbank has total assets of US$2 billion and equity of about US$200 million, and its principal shareholders include the European Bank for Reconstruction and Development (EBRD) and DEG, one of Germany’s and Europe’s largest government-sponsored development institutions. Moreover, the IFC is an international organization established by Articles of Agreement among its member countries.

FIMBank stated that once all conditions and regulatory approvals laid down in the Agreements are satisfied, FIMFactors will subscribe to 40% of the total share capital of CIS (10 million shares at €1 per share). Transcapital will hold 40% with IFC subscribing to a 20% shareholding. Once further conditions laid down in the Agreements are satisfied, another Agreement states that within a 5-year period after the date of CIS’s incorporation, the total shareholding of CIS will be increased to 25 million shares with FIMFactor and Transcapitalbank holding 40% of CIS’ total share capital and IFC holding the remaining 20%.

Moreover, a put-option agreement has also been entered into between the three parties (FIMFactors, Transcapital and IFC) in order to grant the option to IFC for it to be able to sell to both FIMFactors and Transcapital on one or more occasions all or part of the shares it owns in CIS (i.e. 20% of the total share capital).

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