Today in Russian Business – May 21, 2008

Russia’s Center for Political Technologies says the main problem afflicting the country’s economy is corporate raiders using illegal means to seize companies and assets from their rightful owners. Severstal has made a rival bid for US steel company Esmark after the Steelworkers’ Union threatened to block an offer from India’s Essar Steel Holdings. It is thought that support from the union allowed Severstal to keep its bid relatively low. Apparel retailer Gap Inc. will open Gap and Banana Republic stores in Russia through a franchising agreement. AFI Development, an Israeli-owned, Russia-focused real estate company, will sell an office building located in central Moscow for $207 million. Russian regional telecom operator North-West Telecom plans to attract a three year syndicated loan for $150-$200 million in the third quarter of 2008. Yandex, operator of the largest Russian search engine, aims to raise as much as $2 billion in an initial public offering in New York this year. Prime Minister Vladimir Putin has approved “the country’s largest spending project since the Soviet collapse,” a $570 billion program to overhaul and expand the country’s transportation infrastructure over the next seven years. He has also backed the potential investing of pension savings in infrastructure projects. Norilsk Nickel will help the Foreign Ministry to combat terrorism and the illegal trading of precious metals in return for support of its business interests abroad, according to the terms of a new cooperation agreement.