The Russia-China Investment Fund agrees to invest in Detsky mir

Press release, 09.09.2014

Moscow, September 9, 2014 – The Russia-China Investment Fund (RCIF) has reached an agreement in principle on investment in JSC Detsky mir, the biggest player in children’s merchandise in Russia. Currently, one hundred per cent of the company’s share capital is controlled by Sistema JSFC.
 
Under the terms of the deal, most of the investment will be spent towards future development, in particular plans to open new shops and build additional logistics centres. This investment will enable Russia’s biggest children’s retailer to substantially increase its operational efficiency. RCIF’s investment will support the development of the chain by providing modern systems and distribution channels of children’s goods in the Russian regions.
 
Kirill Dmitriev, Co-CEO of RCIF, said:
“We are delighted to invest in Detsky mir, which is a fast developing market leader. Almost a third of the chain’s shops have been opened within the last two years. Our investment will improve efficiency and support Russia’s growing demographic providing access to high-quality children’s goods at affordable prices. The investment will contribute further to the development of the production, logistics and transport sectors in Russia and China.”
 
Mikhail Shamolin, President and CEO of Sistema, commented: 
“We are pleased to announce a proposed cooperation with the Russia-China Investment Fund which marks an important step in expanding our partnerships in Asia. Sistema has a long standing track record of establishing best-in-class companies. Detsky mir is a rapidly developing retailer with excellent growth prospects and a talented management team. RCIF’s proposed investment will help expand Detsky mir's network in Russia and unlock further value for all stakeholders.”
 
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Detsky mir is Russia’s leading retail chain selling products for children (its market share in 2013 reached 18%). The company’s 265 shops are located in 98 cities in Russia and four cities in Kazakhstan. It ranks number one in terms of brand recognition in the children’s retail chain sector, with a recognition rate of 98%. The Detsky mir brand has existed in Russia for more than 50 years. Further information at www.detmir.ru
 
Russia-China Investment Fund (RCIF) is a private equity fund investing in unique opportunities. It has been brought out together by rapid development of economic cooperation, fast growing trade, and increasing purchasing power of the middle class in Russia, China and CIS countries. The Fund was created by the Russian Direct Investment Fund (RDIF) and China Investment Corporation (CIC). RCIF emphasizes cross-border transactions, as well as investment opportunities within the region across a broad range of sectors to facilitate the structural adjustment and the improvement of quality of those countries’ economies. Further information at www.rcif.com
 
Russian Direct Investment Fund (RDIF) was established in 2011 to make equity co-investments, primarily in Russia alongside reputable international financial and strategic investors. RDIF acts as a catalyst for direct investment in the Russian economy. Based in Moscow, RDIF’s management company is a 100% subsidiary of Vnesheconombank. Further information at www.rdif.ru
 
Sistema is the largest publicly-traded diversified holding company in Russia and the CIS, which invests in and is a major shareholder of companies serving over 100 million customers in the sectors of telecommunications, high technology, oil and energy, radars and aerospace, banking, retail, mass-media, tourism and healthcare services. Founded in 1993, the Company reported revenues of US$8.8 billion for the second quarter of 2014, and total assets of US$45.2 billion as at June 30, 2014. Sistema’s global depository receipts are listed under the symbol “SSA” on the London Stock Exchange. Sistema’s ordinary shares are listed under the symbol “AFKS” on the Moscow Exchange. Sistema was ranked number 308 in the 2013 edition of the Fortune Global 500 list. Further information at: www.sistema.com
 
Media contacts: 
Maria Medvedeva 
Russian Direct Investment Fund 
Director, Media Relations Department 
Tel: +7 495 644 34 14, ext. 2141 
Mobile: +7 964 726 17 73 
E-mail: mm@rdif.ru
 
Hudson Sandler
Andrew Hayes / Maria Ignatova / Elena Garside
Tel: +44 (0) 20 7796 4133