Tver Water Utility

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In September 2006, the Municipality of Tver awarded a 25 years lease contract for the city’s water infrastructure facilities to the Rosvodokanal (RVK), one of Russia’s largest private utility operator. The municipality also signed a parallel five year investment agreement with RVK for a total invment commitment of about $86 million. RVK owned a 75% stake in the Tver Water Utility, the municipality owns the remaining 25%. Prior to RVK, the water utility was operated and maintained by the Municipal Unitary Enterprise (MUE). As of January 2007, RVK provided technical and operational management services through long term lease contracts to total six municipal utilities throughout Russia (Barnaul, Kaluga, Krasnodar, Orenburg, Tyumen and Tver). RVK is a wholly owned subsidiary of A1, the private equity arm of Alpha Group, one of Russia’s largest financial and industrial groups, with oil and gas, banking, telecommunications and other holdings. In 2008, RVK obtained a loan from the IFC for RUB624 million or $25 million and another loan from the EBRD for RUB 5.6 billion or $224 million to support its obligations under the six long term lease contracts and investment agreements with the municipalities. The EBRD/IFC loan provided financing to implement 5-year investment programs in each city in which RVK operated in 2007 and the acquisition of new utilities. Information regarding the loan received from the IFC Investment Officer Sergei Mytarev smytarev@ifc.org Investment committment is until 2015