Russian Direct Investment Fund to be cut loose from troubled VEB bank

The Russian Direct Investment Fund (RDIF) is to  be spun off from the troubled Vnesheconombank (VEB) and will  instead report into  the country’s  Federal Property Management Agency,  officials close to VEB told Vedomosti  this week. The change in its status is expected to  be put into effect by the end of  the summer. 

Fisht Olympic Stadium Sochi

Set up five years ago to  attract foreign investment through  project co-financing, the RDIF is now feared to be in danger of being pulled down by VEB’s current difficulties which stem from its use to finance politically motivated but unprofitable projects, notably the 2014 Winter Olympics in  Sochi. “VEB  is almost on the verge of bankruptcy …while the RDIF is an efficient company and should not sink with it,” one of the officials said. 
Since it was established in 2014 the $10bn RDIF has been used to prepare a number of companies for  their IPOs, including the Moscow Exchange and diamond producer Alrosa; and to attract foreign investment into several leading companies operating in key sectors, including Rostelecom, Nord Hydro and the Russian Forest Products Group.

Source: Vedomosti