One Equity backs $1bn Russian fund

JPMorgan’s private equity arm will invest in Russia alongside the investment fund of Russian tycoon Vladimir Potanin. VC firm DFJ also recently partnered a second local Russian group.

A Russian investment partnership has been struck by One Equity Partners and Interros Holding, an investment fund owned by Russian billionaire Vladimir Potanin.

Each will commit $500 million to create a fund that will provide Russian companies growth capital as well as “equity to strengthen balance sheets of portfolio companies” in sectors including consumer, manufacturing and services, according to a statement.

The joint investment company will also “raise a significant amount of new debt for refinancing and optimization of capital structure of its investees”.

Potanin noted the partnership is in line with a push to attract foreign investors to Russia.

Richard Cashin, managing partner of One Equity Partners added the firms “believe that by combining local and foreign capital and expertise, we will help to strengthen Russia’s economic base and provide a successful model for investing private institutional capital in Russia and other emerging markets”.

Venture capital firm Draper Fisher Jurvetson in 2007 expanded its global affiliate network to Russia, partnering with Russia’s VTB Bank to create DFJ-VTB Aurora. They recently teamed with another local Russian group, The Russian Corporation of Nanotechnologies, to launch a $100 million nanotech-focused venture fund.

State-backed VTB was also the local partner for TPG’s purchase of a minority stake in Russian hypermarket chain Lenta, a deal completed earlier this month that was reportedly worth between $110 million and $115 million.