Investment Strategy
Sistema's investments are targeted at development of new and innovative industries. The Corporation develops assets by using its multi-industry expertise and managing shareholder and outside capital.
Value creation model
Block for Chart 1
Multi-industry expertise
In-depth analysis of financial and non-financial risks and opportunities
Increasing the value of assets under management
Organising effective management of the acquired assets.
Formulating a development strategy.
Enhancing business efficiency.
Building synergies with other companies of the Group.
Introducing new technologies and digital solutions.
Monetisation
Generating income from dividends, sale of assets or their stakes.
Allocation of capital
Distribution of dividends among shareholders. Investment in new projects and development of existing assets.
Asset Management
A partnership management model that allows key managers to share the risks and returns from investment activities with the shareholders.
Sistema's Managing Partners are in charge of implementing investment strategy at portfolio companies and supervising asset management through the boards of directors of respective companies.
They are responsible for:
- Formation and operation of the boards of directors, recruitment of the CEO and senior executives of assets under management
- Finding investors and strategic partners for portfolio assets
- Looking for new investment opportunities and strategic partners
- Creating value and monetising assets
Investment Project Selection
Managing Partners
Search for investment projects.
Expert Council
Approval of investment ideas. Obtaining mandatory approvals from the Strategy Department, Finance and Investment Department and Corporate Governance and Legal Matters Department.
Finance and Investment Committee
Step 1. Project approval and development of business plan, setting timelines and preliminary terms and conditions. Step 2. Approval of a transaction and its final terms and conditions. Each step requires obtaining approvals from the Strategy Department, Finance and Investment Department and Corporate Governance and Legal Matters Department.
Board of Directors
Approval of major transactions involving assets whose value totals from 25 % to 50 % of the book value of the Corporation's assets or potential divestment of real estate assets whose value exceeds 10 % of the book value of the Corporation's assets.
Meeting of Shareholders
Approval of major transactions if their total value or the book value of the assets that are acquired or divested as part of such transactions exceeds 50 % of the book value of the Corporation's assets.
Sistema's Investments
All assetsCurrent investments
Sistema invests in the controlling stakes of major assets, including companies with value growth potential exceeding USD 1bn. The Corporation creates value via active management of acquired assets with potential engagement of a financial partner.
Financial terms
Deal size: starting from USD 100 m; stake from 50 % + 1; required IRR > 25 % in roubles.
The Corporation acquires assets with acceptable debt levels (Debt /OIBDA of the acquired asset <3.0x) or with a higher debt level subject to availability of a 2-year debt reduction plan.
Sectors
No restrictions, but in the order of priority: consumer segment, B2B segment with export potential and real estate.
New Investments
Investments in technologies of the future
Investments in major IT companies
Investments via existing and new venture funds under Sistema'smanagement. Monetisation via closing funds. Mandatory engagement of external investors as financial partners (the stake of external partners is at least 20%)
Investments in major IT companies
Direct investments in large stakes in IT companies that do not meet Sistema'srequirements to the investment theses of its own funds and offer an opportunity to create a business valued over USD 1 bn and conduct monetisation in 5-7 years.
Sectors
Software development, e-commerce, Internet companies, Internet of Things, virtual assistants, machine learning and neural networks, cyber security, medtech, AR/VR, etc.
Investments in Russia's traditional industries
Mature undervalued assets
Investments in significant and controlling stakes of big assets on attractive markets in Russia. Acquisition with a significant discount to the market value with a possibility of quickly reducing the discount: sale within 2-3 years.
Growing assets
Acquisition and consolidation of players. Generating value by ousting competitors, consolidating an industry, using the economy of scale and market growth. Exit in 4-5 years through sale to a strategic investor/IPO.
Sectors
Markets worth at least USD 1bn with high growth rates, import substitution capacity and strong export prospects.
Invest and develop your business
Sistema is heavily focused on cooperation and partnerships with leading multinational and Russian companies. Always open to discussing potential co-investment projects, it will become a reliable partner for your business.
Consolidated revenue, bn ₽