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Premium member Presentation Transcript Slide1: Public Sector and Infrastructure: Citigroup's Global Footprint and Experience in Investment Projects in Russia Andrey Mineev, Public Sector Banking Head 6 September 2006 Citigroup’s Leadership in Infrastructure Advisory and Financing: Citigroup’s Leadership in Infrastructure Advisory and Financing Roads Rail Ports Airports Social Infrastructure Experienced adviser on PPP #1 Financial Adviser #1 Global Bank Debt Arranger #1 Bookrunner of Bonds Leading securitisation house RailMarket leader in financial services to the infrastructure sector: Market leader in financial services to the infrastructure sector INFRASTRUCTURE PHASES SERVICES Project Finance Debt Capital Markets / Loans Corporate Finance Advice M&A Investor Coverage Equity Capital Markets Privatisation Expansion Refinancing Restructuring Sales Construction Portfolio Management Listing #1 PROJECT FINANCIER1 Rank Financial Adviser Volumes (US$bn) Citigroup Macquarie Bank CSFB Royal Bank of Scotland PwC 1. 2. 3. 4. 5. 43.1 35.7 31.4 29.4 22.0 1. Source: Dealogic (Global Infrastructure Closed Deals 2001-2005) THE STRUCTURED DEBT LEADER 3. Source: Thomson Financial (exc. CDOs) Rank Bookrunner Volumes (US$bn) Citigroup UBS Merrill Lynch 1. 2. 3. 229.7 199.2 120.7 US MUNICIPAL BONDS 2001-20052 Rank Financial Adviser Volumes (US$bn) Citigroup Barclays Capital Deutsche Bank 1. 2. 3. 122.4 102.1 98.6 INTL SECURITISATION 2001-053 2. Source: Thomson Financial #1 GLOBAL INFRSATRUCTURE FIXED INCOME1 Rank Manager Volumes (US$bn) Citigroup Lehman Brothers JP Morgan Barclays Capital CSFB 1. 2. 3. 4. 5. 82.4 41.5 41.2 34.3 30.8 A Leader in PPPs: A Leader in PPPs Citigroup has played a pioneering role in the development of the private infrastructure market since its inception and helped introduce new forms of private sector involvement in projects, combining public and private elements of funding. We are leaders in the provision of advice and financing for large projects involving complex operations across infrastructure sub-sectors: Roads: We have participated in the most important road projects to date, particularly in Europe: UK (A13 & A1 D2D); Portugal (Second Tagus Crossing, West Concession, Brisa - Eurobonds, IPO); Spain (ENA - bonds, privatisation; Aumar - capital increase); Italy (privatisation of Autostrade / acquisition financing); Austria (toll roads around Vienna); Eastern Europe (A1 and A4 motorways in Poland; financing of Hungarian State Motorway Company) Airports: Currently advisors to Athens International Airport and Abu Dhabi authorities. Previously advised Australian government on Sydney Airport ($3.2bn), Dutch Government on IPO Schiphol Airport, Aeroporti di Roma project company on financing (€1.8bn) and Adviser to the Airline Group on its successful bid for an air traffic control PPP concession and on restructuring options following 9/11 Rail: We have particular expertise in the railway sector. We are currently advising the UK Department of Transport in relation to the CTRL and Eurotunnel and previously advised on CrossRail and the formation and financing of Network Rail. Also co-led the financing of the innovative Italian high speed rail project TAV Accommodation: We have extensive expertise in building infrastructure projects. We recently advised Aspire as the preferred bidder on the Allenby / Connaught MoD PPP accommodation project. We have also advised on various hospital projects, including University College London Hospital, where we advised the Health Management Group Unparalleled experience advising on combined public and private sector financing Citigroup’s recent infrastructure projects in Russia: Citigroup’s recent infrastructure projects in Russia Odintsovo Bypass Toll Road New Exit to the Moscow Encircling Highway from M-1 Highway Developed by Ministry of Transport and the Federal Road Agency (Rosavtodor) of the Russian Federation Construction is assumed to commence in 2008 with completion anticipated in late 2009/early 2010 The length of the Project would be around 19.5km Citigroup acted as Investment Consultant for the project Moscow - St. Petersburg High Speed Railway Project would provide a vital high speed link between Moscow and St. Petersburg The sponsors of the Project are JSC Russian Railways, ZAO TMH and RAO VSM Construction is expected to commence in 2007 with completion due in 2013 Length of 659km Citigroup acted as Investment Consultant for the project Citigroup’s recent infrastructure projects in Russia: Citigroup’s recent infrastructure projects in Russia Mixed Cargo Handling Complex at Ust-Luga Marine Port Project being developed under the auspices of the Federal Targeted Programme for Updating the Russian Transport System Strategically located in the Gulf of Finland with close proximity to St. Petersburg; envisaged to form part of the transport network of the Northwest Region Sponsor of the project is established SPV JSC Ust-Luga Expected completion of project in 2008 Citigroup acted as Investment Consultant for the project Taman Commercial Seaport Project involves the construction of a greenfield (new) commercial seaport at Kuban in the Krasnodar region Sponsored by the Government of the Krasnodar Region and JSV Agro-Industrial Corporation Asto Would have 9 specialised cargo-handling complexes with an estimated cargo handling capacity of over 30m tonnes per annum Construction is expected to take 4 years Citigroup acted as Investment Consultant for the projectMoscow — St. Petersburg Toll Road Project: Moscow — St. Petersburg Toll Road Project Project Overview: Project Overview Construction of the Moscow – St.Petersburg toll road Initiated by the Russian Ministry of Transport and the Federal Road Agency National project of significant magnitude Integrated into system of international transport routes including: Pan European transport corridor N. 9 Pan European transport corridor N. 2 International transport corridor ‘North-South’ Expected size of investment: US$6.3bn Highlights National project of significant magnitude aimed at creating a modern transport communication link between Moscow and St. Petersburg.Current Traffic Dynamics: Current Traffic Dynamics The existing M10 has reached or exceeded capacity at key bottlenecks Car traffic represents about 74-90% of total traffic on the Moscow – St. Petersburg route, with bus and truck traffic accounting for the remainder Breakdown of Vehicle Type by RegionStage I (15—58 km): Stage I (15—58 km) KM 15 Stage I Moscow—St. Petersburg road Toll RoadStage I — Highlights: Stage I — Highlights Stage I, 15—58 km Governmental Concession Agreement (30 years) Transfer of asset back to Government at the end of year 30 To be undertaken in three phases Expected completion date by 2011 Estimated funding requirement: US$1.425bn Project Nature 20% Equity 80% Debt Number of traffic lanes: 10 (15—29 km), 8 (29—35 km), 6 (35—58 km) Bridges: 6 Overhead roads: 11 Crossovers at traffic intersections: 7 Crossovers to connect detached territories: 9 Sources of Funds Technical detailsStage I — Key Financials : Stage I — Key Financials Investment mechanism aimed at creating conditions for diversification of the Russian economy structure and maintenance of steady economic growth Its basic purpose is to attract private capital through development of public-private partnership to implement major of infrastructural and innovative projects at national level Investment Fund of the Russian Federation Stage I — Expected Revenues : Stage I — Expected Revenues Pricing strategy Expected traffic volumes Based on providing quality services at socially justifiable prices to users Toll rates would take into account the services offered and expenses relating to road construction and operation The assumed toll depends on the type/capacity of vehicle/demand elasticity Once toll rates are set, project revenues are estimated based on traffic flow for the duration of the concession The Concessionaire shall collect road-use tolls. If revenues are below a guaranteed minimum, the State shall pay appropriate compensation Pricing strategyStage I — Overall Benefits and Status : Stage I — Overall Benefits and Status Promotion of traffic growth by congestion reduction Reduction in travel time Decrease in transportation costs Reduction in traffic accidents Feasibility Study of the project started in 2004 Submission to the Investment Fund in May/June 2006 Selection by the Investment Fund in June 2006 Status Enhancement of population mobility Economic development through better transportation links Creation of jobs Development of PPPs BenefitsSlide15: Corporate and Investment Bank Citigroup – Your Partner in Russia M&A Transaction Services Treasury Corporate Finance and Lending Trade Securities Services Working Capital Account Services Cash Management Collections FCY Lending Invest. Bank Consumer Bank Banking Cards You do not have the permission to view this presentation. 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