Afisha Industries PDF. Processed by PitStop...

theTroiker №5The magazinefor those who wish tosurpass dreams

november 2008

We will break through!Interview Ruben on the latest Annual Results Informal notes from the CFOSpecial Project Murex Profession The Titans of Private EquityIn Focus St. Petersburg SKOLKOVO The EMBA at long last begins

Issueprepared by:

november 2008 The TROIKER 1

Dear Troikers,

The fact that you have in your hands a new issue of the Troikeris good news in itself.

While the entire financial year was packed with events, it will beremembered most of all for the final two months — when the en-tire world went upside down. Everything has changed before ourvery eyes. We are right in the middle of something…VERY SIGNIFI-CANT. Only what? Nobody knows for sure. Even we don’t know. Un-certainty is always scary. A new era has started, the era of “in-stantaneous obsolescence,” when the old rules and standards no lon-ger work and the new ones still haven’t been invented.

The time of true values has started. A time to find out who’s who. Weneed to take a fresh look at the world, our business, and ourselves.Most important, we need to act. We need to act as quickly and pro-fessionally as possible. Not only to stay afloat, but to remain in theavant-garde. We need to rebuild now, before it’s too late.

Creating this issue of the Troiker was a challenge. We hope that all the-se materials — at least the majority of them — will stay relevant longenough for you to read them. Following tradition, the November issueincludes a summary of the fiscal year’s results, as well as a descriptionof Troika’s life during this time.

As they say, what doesn’t kill you only makes you stronger. We are tru-ly proud that we managed to keep our independence. No other invest-ment bank survived without state support.

Despite all the challenges, we have the chance to continue moving for-ward. We have all the weapons needed — the main thing is a bit of luck.

We will break through! After all, if not us, then who? Best regards,

The Troiker Editorial Board

theTroiker№5

Founder:

ZAO Troika Dialog

Investment Company

4 Romanov pereulok

Moscow Russia 125009,

Tel.: +7 (495) 258 05 00

Fax: +7 (495) 258 05 47

www.troika.ru

Editor in Chief:

Elena Arshukova

Inspired by:

Gor Nakhapetian

Inna Mioserdova

Internal Communications:

Lubov Eliseeva

Staff Correspondent:

Maria Zalunina

Editor-translator:

Christopher Wood

Editors:

Ina Mandre

Margarita Volkova

Assistant:

Anastasia Aslanyan

Images in the issue:

© Troika Dialog photo bank

Publishing company:

ZAO Afisha Industries

www.atelier.afisha.ru

Editorial Office:

7/28 B. Gnezdnikovsky Per., unit 1

Moscow Russia 125009

Tel.: +7 (495) 785 17 00

Printing:

My Vmeste Printing

© 2008 ZAO Afisha Industries

This magazine is intended for free

distribution among Troika Dialog

employees

theTroiker №5november 2008

4 What’s up?

The latest newsat Troika

18 Annual results 2008

A present to all Troikers:а Christmas tree covered with ourachievements and major deals

10 Ruben Vardanian: A crisis is no reason toget carried away

About what every Troiker wantsto know

16 Informal notes from

the CFO

Yuri Nechuyatov about the

2008 fiscal year and what lies

ahead

20 Come and fly thefriendly skies!

Starring: the Murexproject team

24 Troika’s Titans of PrivateEquity

Three titans of Private Equity abouttricks of the trade

30 Troika on the Neva

Special report by Maria Zaluninafrom Troika’s St. Petersburg office

34 Key appointments

Troika’s new employees answer ourquestions

38 Leisure

Books, movies, exhibitions,theatre — the main autumn events

42 Reading lessons

Books by Tom Peters and AlanGreenspan

44 Education

SKOLKOVO announces the EMBAprogram


Contents

4 The TROIKER november 2008

What’s up? Troika’s news

New office in Saratov; nanotechnologies; major agreementwith Sberbank; Troika’s bank agents` outing

Expanding BordersTroika Dialog has signed a partnership agreementwith the Saratov Area Government andannounced plans to develop business in theregion.

One of Troika’s new programs for the region will be a series ofevents aimed at developing the region’s financial market, as wellas raising the region’s investment attractiveness. The events, whichwill be held in the conference, seminar, or round table format, areintended for government servants and company representatives.The Saratov Area Government will in turn grant Troika the oppor-tunity to participate in the local social and investment programs.“The Saratov Area enters into the top five leaders of the PrivolzhskyFederal District in terms of growth tempos in gross regional pro-duct and the share of tax revenues in the Area budget. Over 30,000businesses are located in the Area. The Area’s major businesses,those entering into the “Billionaire’s Club,” include representativesof the electro-energy industry, a priority business line for Troika.One such company is Volga TGC, one of Troika’s most reliable part-ners. In March, 2008, Troika Dialog put the company on the pub-lic market. From November, 2007, to May, 2008, Troika Dialog Gro-up Managing Directors Pavel Teplukhin and Sergei Skvortsov par-ticipated in the Volga TGC Board of Directors. We are prepared tooffer our expert knowledge in the sphere of corporate manage-ment and raising capital for long term development to other com-panies in the Area as well,” Andrei Sharonov remarked.

The future is in nanotechnologies

Sergei Skvortsov, Manаging Director of Troika Dialog Groupand President of Troika Capital Partners, has joined the In-vestment Policy Committee under the Supervisory Council ofthe RUSNANO Russian Nanotechnologies Corporation. We remind you that Pavel Teplukhin, Managing Director ofTroika Dialog Group and Chairman of the Board of Directorsof Troika Dialog Asset Management, has headed the In-vestment Policy Committee since May, 2008. The InvestmentCommittee, which prepares estimates and expert opinions,helps the RUSNANO Supervisory Committee make decisionsregarding financing for scientific research inventions in thenanotechnologies sphere. In order to evaluate incoming in-vestment requests, our company brings in Russian and for-eign specialists in the major technological clusters. In addi-tion, Troika Dialog employs a number of specialists with suc-cessful backgrounds in innovative business.

The SaratovArea’s majorbusinesses in-clude repre-sentatives ofthe electro-energy indust-ry, a prioritybusiness linefor Troika


The long-awaited super-agentTroika Dialog’s asset management mutual fundswill be distributed through Sberbank of Russialocations

Troika Dialog continues expanding its customer service base andbuilding an effective network of bank-agents. Starting in October,shares in nine of Troika Dialog Asset Management’s funds will beavailable for purchase at 144 branches of Sberbank of Russia inMoscow and other cities. “With Sberbank — Russia's largest bank — as its newest agent, Troi-ka Dialog has strengthened its leadership positions on the mutu-al fund market and on the market of bank-based investment pro-duct distribution,” announced Andrei Zvezdochkin, Co-director ofTroika Dialog’s Personal Investments. “Currently, 65,000 clients haveinvested over one billion dollars into Troika Dialog Asset Mana-gement's mutual funds. With the addition of the Sberbank branc-hes, the sales network of our funds will increase to 515 offices.We are confident that the unique distribution possibilities offeredby Sberbank, together with the effective investment solutions ofTroika Dialog, will guarantee the best results for our joint project.”As of today, Troika Dialog Asset Management's agency network isRussia’s largest and consists of 16 bank-agents including Sberbank.

Italian-style outingAt the start of October, Troika held its se-cond annual meeting of bank-agent re-presentatives. This year, the event washeld on Lake Komo, one of the most sce-nic parts of northern Italy. The locationwas not chosen by accident. We alwaystry to hold these kinds of events at spec-tacular, unforgettable locations, whichare not only appropriate for discussingbusiness-related issues, but for recrea-tion as well. Enjoying the informal at-mosphere, Pavel Teplukhin, Andrei Zvez-dochkin, Oksana Aleksandrova, OlegLarichev, Olga Logvina, and Troika’spartners — representatives of the bank-agents (Sberbank, Citibank, RaiffaisenBank, UniCredit, BSGV, Barclay’s Bankand others) — discussed long term part-nership perspectives. The conferencewas a hit. And, of course, the warm andtrusting atmosphere and exciting en-tertainment program created an im-pression on everyone. Events like thisare becoming tradition at Troika, cont-ributing to stronger, enhanced rela-tionships with our partners.

The uniquedistributionpossibilitiesoffered bySberbank,together withthe effectiveinvestmentsolutions ofTroika Dialog,will guaranteethe bestresults for ourjoint project

KOM

MER

SAN

T (1

)



The second phase of Single View of the Client project; new system of personnel administration;new office in Khabarovsk; presentations in the U.S.; II Annual Meeting of the New Champions

New Office inKhabarovsk!Troika Dialog plans to make everythird private investor in Khaba-rovsk a company client.The official opening of Troika Dia-log’s Khabarovsk office took pla-ce at the end of September. As partof the ceremony, a partnershipagreement was signed betweenthe company and the KhabarovskKrai Administration. Speaking at apress lunch to mark the opening ofthe Khabarovsk office, NatalyaVoichuk, Director of the Khaba-rovsk office, articulated Troika Dia-log’s plans for business develop-ment in the region. The companyplans to establish partnershipswith a wide circle of corporate cli-ents and private investors. Troika’sexperts give the Khabarovsk Kraihigh marks for investment attrac-tiveness.

Single Viewof the ClientSingle View of the Client, astrategic CRM project hasentered its second phaseinvolving Global Markets,Investment Banking, Research,and Business Services

The project will run for an overall term ofnine months. The Event Management mo-dule will also be launched by 2009, allowingus to systematically prepare for “The Rus-sia Forum — 2009.” The start of the secondphase of the project comes at a difficulttime for everyone. However, this fact ac-tually led us to accelerate the project rat-her than halting it, as we understand howimportant it is to work with existing clientsand attract new ones.

SAP — up and running!A new, automated system of personnel administration whichoperates on the basis of the SAP platform is up and running

The system will allow the HR Department and the Payroll Accounting Group to interactmore efficiently and improve work inside the departments. As a result of the new sys-tem, five separate information systems have been merged together. The project was start-ed in 2006, when it was clear that Troika was entering a phase of active growth and thatthe existing IT services were not up to the task. The company chose the SAP system oversuch competitors as Oracle EBS, Robertson & Blums, and Microsoft Axapta. The SAP sys-tem stands out for its reliability, popularity, and the considerable number of functions itoffers. We are grateful to everyone for their work on this project, especially the IT, HR,and Finance Departments.

The start ofthe secondphase of theproject comesat a difficulttime for eve-ryone. Howe-ver, this factactually led usto acceleratethe projectrather thanhalting it, aswe under-stand how im-portant it is towork with exi-sting clientsand attractnew ones

ITA

R-TA

SS (

1)

Second Annual Meeting of theNew ChampionsThe Community of Global Growth Companiesonce again brought together dynamic growthcompanies for its annual gathering in China,called the Annual Meeting of the NewChampions. This time around, the Meeting tookplace at the end of September in Tianjin

The World Economic Forum (Davos) — the initiator of the GlobalGrowth Companies Business Community — organized the event.Troika Dialog, the Meeting’s Russian partner for two years in a row,put together the delegation of Russian participants.The Meeting offers participants new opportunities to discuss de-velopment outlooks and create a plan of action based on new ide-as, innovative business models, and advanced technologies. The pur-pose of the Meeting is to work together toward creating surefirestrategies for globalizing business. The shifting nature of develop-ment within countries and industries forces those companies stri-ving toward international-caliber growth to constantly adjust the-ir course in the unpredictable conditions of the world economy. Inthis new era, the champion is the one who perceives new oppor-tunities behind all the continuous changes. For this reason, the maintopic at the 2008 Meeting was “the new wave of growth.”The Annual Meeting of the New Champions took place at a chal-lenging time, with the global community busy looking for new

ways to get out of the economic crisis. However, dynamical-ly developing companies from all over the world, many of thempart of the Global Growth Companies Community, are capab-le of starting a new wave of growth. In Tianjin, these newchampions will tell everyone about their experiences and the-ir take on the future.The Meeting of the New Champions was attended by more than1500 delegates representing 90 countries. Approximately 50 com-panies from Russia and the CIS expressed interest in the annualmeeting in China, many of them having joined the Community ofGlobal Growth Companies last year, when they attended the Me-eting by invitation from Troika Dialog.


Higher learningAt the end of October, Troika held several presen-tations for MBA students from leading universitiesin the U.S. Chris Osborne, Head of the New York of-fice, together with HR managers Anna Krasner andOksana Fomicheva, spoke about career opportuni-ties at six universities: the University of ChicagoGraduate School of Business, Massachusetts Insti-tute of Technology and Harvard Business School(Boston), Wharton-University of Pennsylvania(Philadelphia), New York University's Leonard NStern School of Business and Columbia BusinessSchool (New York). As difficult times settle upon theworld financial markets, new opportunities are be-ing created, including the chance to take on youngand talented professionals. As the fastest, most dy-namically growing investment bank in Russia, Troi-ka is a unique and exciting option for MBA gradu-ates. The company is staffed with professionals atthe heart of Russia’s stock market, people with un-surpassed knowledge and experience working in cri-sis conditions. We hope this step will soon lead tothe desired results, and that the best MBA gradu-ates will be joining our team.

The Meetingoffers partici-pants new op-portunities todiscuss deve-lopmentoutlooks anddevelop a planof actionbased on newideas, innova-tive businessmodels, andadvancedtechnologies

RPG

/CO

RB

IS (

1)

ITA

R-TA

SS (

1); R

EUTE

RS

(1)



Sotheby’s autumn auction andthe XXV Russian Antique Salon supported by Troika

Art-BankingTroika Dialog once again acted as General Partner to the Russian Antique Salon.The event took place at the Central Artist’s House October 18–26. This year, the jubilee XXV antique salon featured a special project: an exhibit ofWestern European stained glass collections from the XII–XIX centuries and por-celain from the XVII–XIX centuries. Troika Dialog Asset Management clients wereable to see the most interesting objects from the exposition during a private vie-wing on October 17. “Antique salons are a great way of making Russia’s art mar-ket as civilized as possible,” pointed out Pavel Teplukhin, Chairman of Troika Dia-log Asset Management’s Board of Directors. “This is an important process; whenbuying and selling works of art becomes transparent and comfortable for buy-ers, sellers, and middlemen, it is possible to begin discussing investments intoart. What we are doing is developing our art banking business line, meaning weguide people through the process of purchasing works of art. Traditionally, TDAMPrivate Banking specialists have consulted visitors to the Russian Antique Salonon such matters while the event is taking place.”

Art is eternal…Troika became a partner of Sotheby’s auctionhouse, the organizer of an exhibit showing thebest lots from the autumn auctions that tookplace at the Moscow State Museum ofContemporary Arts in October, 2008

Included in the display were sought after paintings by impressionistartists, in addition to works by contemporary Western and Russ-ian masters. Troika offered its clients the chance to see the mas-

terpieces first. A preview was organized for this purpose the daybefore the exhibit opened. Visitors to the exhibit saw works byClaude Monet, Edgar Degas, August Renoir, Paul Cezanne, PabloPicasso, Vasily Kandinsky, Marc Chagal, Fernando Lezhe, MauriceVlaminck, and Alberto Jakometti. Contemporary Western art includedworks by Andy Warhol, Jeff Kuntz, Takeshi Murakami, and DamienHirst. The Russian part of the collection included three masterpiecesby Boris Grigoriev.

Troika offeredits clients thechance to seethe masterpie-ces first.A preview wasorganized forthis purposethe day beforethe exhibitopened

Interview Ruben Vardanian

About what every Troikerwants to know


PHO

TO F

RO

M T

HE

TRO

IKA

DIA

LOG

AR

CHIV

E

Ruben Vardanian:

“We are witnessing a crisis of coordinates” — Ruben, I am far more removed from the financial markets thanyou, so I would like to hear from you, a professional: what is hap-pening right now? Where did this crisis come from? — As you are aware, there is no brief answer to this question. Thereasons are both deep and complex. The crisis did not come aboutsuddenly; it was the result of a chain of facts and events that havebeen happening in the world for as long as 20 years now. — Seriously, that long?— That’s a fact. Over this time the world has become in the finan-cial sense far more global than it was before. America suddenly re-alized it could print money without creating inflation. Basically theillusion was created that certain laws that had worked forever wereno longer in force, since the world had apparently changed. But itturned out this was by no means true. First of all, no one is em-powered to rescind the fundamental laws; they work no matter what.Second, the possibilities opened by the financially global world con-cealed threats that went unnoticed for quite some time. They shouldhave been noticed, because opportunities always involve hiddenthreats. — What exactly do you have in mind?— As an outcome to this globalization, we were faced with an enor-mous market of financial products, which turned out to be difficultto estimate and practically impossible to regulate. The reason for thisis that the market is international, while the regulators are localizedand national. The system we encountered was dominated by shortterm earnings and people did not have the motivation to work inthe long term perspective. Not to mention, major geopolitical changes

In all honesty, I expected my meeting with Rubento be called off. Our plans were made back in Sep-tember, when I (like everyone else) still did not be-lieve a true crisis had occurred. Then the crisis be-came the number-one issue. My immediate thoughtwas: “If even I have a slight headache from all this,who knows what the director of a major investmentcompany must be feeling.” However, on the day

before our meeting, I received a call from Lena Arshukova, editor-in-chief of TheTroiker, who cheerfully informed me that Ruben was prepared to meet as origi-nally planned. As if nothing had happened over the past month.— I was expecting to hear the meeting was canceled — is the first thing I said thefollowing day, as Ruben and I settled behind a long conference table in one of Troi-ka’s quiet, businesslike offices.— That’s why Troika is different; we don’t rush to put out fires. We try to workmethodically, for the long-term, - he answered. - There’s no other way. If you workfrom fire to fire, things will be over in a hurry, with bad results.

Yuri Katsman, General Director, “Zhivi” Media Group, exclusively for The Troiker

A crisis is no reason to get

carried away


were taking place. Over the past 20 years, the Soviet Union fell apartand China has continued growing; the world has changed so muchthat the United Nations stopped being effective; the IMF and the WorldBank stopped working after people lost confidence in them duringthe ‘90s. Then the Kosovo precedent was set, revealing certain prob-lems in International Court of Justice as well. In terms of the econ-omy, countries like Russia, India, and China became quite attractiveand received large volumes of investments. New markets took shape,massive migration was started, and the internet initiated the nexttechnological revolution; information became immediately accessible.Basically a number of very important changes took place and a crit-ical mass was eventually reached, at which point quantity turned into

quality: the world realized it could no longer be ruled by a single gov-ernment — as it basically was until that point — and that the oldermodels no longer worked. This made the situation erupt. — But crises have occurred before. Even in the time you just ref-erenced, there was 1998…— Today’s crisis is totally different; it’s more global and fundamen-tal. What is happening right now is not just an economic crisis, buta crisis of the system of trust and basic coordinates, when you sud-denly have no idea how to differentiate between right and wrong.It’s just that when you are losing more money on AAA-rated in-struments than you are with B-rated instruments, you have a hardtime believing it! There’s no way it can happen, it violates the en-tire system of coordinates! Maybe it can happen with a single in-stitution, but at the systemic level one is supposed to lose more mon-ey on instruments with a lower rating. This is an axiom — at leastit was until recently. Unfortunately, what is happening right now hascast doubt upon a number of things: the system of accountability,

the actions of regulators, the effectiveness ofratings agencies, the system of financial information, estimation meth-ods and the overestimation of assets — lots and lots. We are alsowitnessing a crisis of leadership. Leaders in today’s world, especiallywithin private companies, are supposed to have certain morals. Be-cause of mistakes made by the directors of private and publicly trad-ed companies, taxpayers were forced to pay up and political lead-ers were forced into action. — If the world was building up to this for so long, how is it pos-sible that nobody saw the crisis earlier, like one year ago, for ex-ample?— The signs were there. Several famous analysts even spoke aboutit. But, as I have already said, nobody was able to gage the size ofthe threat. Nobody could have predicted that it would happen likethis and that all these negative factors would converge into a sin-ister, interrelated whole. There was a feeling that a crisis was in-evitable, but it seemed that it would be localized rather than sys-temic. True, assets were overestimated and cheap money was avail-able. U.S. credit policy clearly entailed too much risk. But there was-n’t a feeling that everything would lead to a global collapse. Evenwhen the liquidity crisis had started and problematic debts were be-ing written off, nobody predicted a systemic problem. It seemed likethe problems would be kept to the major financial institutions. — And, as always, Russia was hoping for the best…— As a matter of fact, if you take an objective look at the situation,there was more than enough evidence to suggest that the crisisshould not have affected Russia like it did. There is a small amountof leverage in Russia — objectively, we have no gigantic debt, the

“Today’s crisis is totally different; it’s more global and fun-damental. What is happening right now is not just an eco-nomic crisis, but a crisis of the system of trust and basiccoordinates, when you suddenly have no idea how to dif-ferentiate between right and wrong”




kind that is several times bigger than our economy. This is fact num-ber-one. The second fact is our considerable economic growth. Thethird fact is our enormous internal market, which still has plenty ofroom to grow. Whereas in the U.S. mortages were granted to everythird or fourth home — to people who by no means should have hadaccess to home financing — mortgages in Russia occupy just 2% ofthe GDP. Even credit-worthy borrowers are still waiting in line. Plen-ty of factors are working in our favor. This is why nobody could haveimagined that Russia would drop so far — a 75% drop compared toMay. It would have been downright silly to make such a predictionat that time. — However, there’s no changing what happened. What kind ofposition do you think Russia is in now? — Well, Russia has one powerful, indisputable competitive advan-tage — not even competitive, but psychological. Multiple genera-tions of Russians have lived through crises; we have learned to sur-vive. We have seen cards, barters, vouchers, defaults, bankruptcies— we have volumes of experience.— Could you possibly answer a bit more technically?— Technically speaking, Russia has been held hostage by a very se-rious problem — a lack of investors with long money. Although thecountry’s dependence upon international investors is not what it wasduring the 90s, it remains high. The departure of these investorscaused our market to drop off far more steeply than it would haveotherwise. The second problem is the following: since 2001 our coun-try has lived under conditions of continuous growth. This kind ofgrowth leads businessmen and bankers to begin living in the nextparadigm: the important thing is for me to have a greater share ofthe market and for me to grow. I will take cheap, short term mon-ey, in order to create long term projects. I will buy industrial assetsand use them as leverage to buy new industrial assets. Such logicis founded in three very dangerous hypotheses. First, I will alwayshave access to short, cheap money. Second, a growing, profitablebusiness cannot go bankrupt. Third, asset value will always growfaster than debt. But now we know that assets can drop in value,while the amount of debt stays the same. What’s more, this debtis still short term, and refinancing isn’t an option. As a result, evenif your business shows a profit, you are bankrupt anyway. Russia alsohas a third major problem — a weak, underdeveloped financial in-frastructure. The lack of a central treasury, the lack of a central coun-teragent, one who guarantees liquidity under repo, the lack of a fulland accurate understanding of who regulates the market and howexactly it should be regulated, a neglected stock market — all of thisled to unfortunate results. — And the conclusion? Bad news in general?— It’s hard to say. The problem right now is not that nobody knowshow this will end, but when. We are currently at the heart of tur-bulence. Nobody knows when this will be over and what is need-ed in order for it to end. There is just an understanding that the fi-nal, powerful blow, the one that will bring absolute cleansing (fig-uratively speaking) is still coming. There are two scenarios. Num-ber one: within the coming two to three weeks — in November, ac-tually when we release our magazine — we will have a more or lesscomplete picture. Although it may be upsetting, at least it will be com-plete. As soon as things become clear, new opportunities will appear

— people will come up with new ideas, make new plans, based uponthe new reality. Here’s the second scenario: none of this happenswithin two-three weeks. In this case, we may see global-level ac-tions far beyond the limits of what is called market-oriented. In the-ory, anything can happen; we may enter into a crisis tailspin in whichseparate governments make radical decisions. One hypothetical ex-ample: all debts are cleared and all previous accounts payable arewiped clean. There may be decisions that lead to strict protection-ism and the total isolation of one country from the rest of the world.For example, Germany might say “We’re strong; who cares aboutthe EU. We’re leaving the EU, reestablishing the border, and every-thing we do will be for our own good. Now we do not have to wor-ry about Ireland and Bulgaria.” This would lead to a serious systemiccrisis that would last for a long time, until things start to be restored.— Suppose this happens. What are Russia’s chances?— Russia is different from other countries, and for more reasons thanjust the survival gene. First of all, we still have an enormous inter-nal market, one that is capable of growth. The Russian economyshows potential. Second, we still have our tremendous natural re-sources, which will allow us in the event of hyperinflation or glob-al protectionism to live better than a number of countries. Clearly,there are risks. However, Russia on the whole is better suited for suchoutcomes than a number of seemingly stable countries.

“They said I was securing money for Troika. Absurd!”— Ruben, how would you say the authorities and regulators havereacted to the crisis? Would you say their actions have been ap-propriate, timely, and competent? — I think that everything has been done within the realm of feasi-bility and that things are happening at a quick pace. It’s a separatematter that people in a serious crisis like this cannot thoroughly workout the effect of one measure or another. Here’s the main problem:it’s one thing to declare certain measures, but something else en-tirely to see them through. So I would answer the following: if weevaluate the authorities in terms of the measures that have beenannounced, evaluating them in terms of their efforts to figure outwhat is happening and how to cope, then they have taken all theright actions. As for the fact that certain measures were cut short,alas, we are dealing with inert bureaucracy, something you find inevery country. The declarations were absolutely correct, timely, andaccurate; the implementation was less than ideal. That and, of course,the stock market is neither one of the government’s major concernsnor a state priority. The banks, however, are a state priority. This iswhy the authorities observed the crisis primarily through the prism

“Russia has been held hostage by a very serious problem —a lack of investors with long money. Although the country’sdependence upon international investors is not what it wasduring the 90s, it remains high”


of the banking system, deposit defense, financing for the real sec-tor, etc.— You were actually a participant — apparently the lone repre-sentative of private business — in discussions with the gov-ernment about how to handle the crisis...— Yes, in September.— How did it go? What score would you give the government’s“firefighters” in the managerial arts? — These are highly competent people who work with the desire tofigure out what is happening and how to solve the problem. Firstand foremost, they are working in a time crunch. Second, they area priori lacking knowledge and information about what is happen-ing in reality, because reality is always far more complex than it seems“from above.” Third, it isn’t immediately clear how to battle a tsuna-mi and show resistance to something coming at you; after all, thecrisis arrived from elsewhere. As I said before, there were no ob-jective reasons for Russia to take such a fall. The possibilities for ef-fective action in a situation like this are limited. That and, of course,certain members of the team obviously want to insure their actions,so that later on they will not be accused of anything inappropriate.Or, what’s worse, accused of collusion. — What’s in it for you personally? Why did you contribute to dis-cussions about the anti-crisis measures? After all, this means youare also responsible for the results…

— Well, you know, this wasn’t a spontaneous desire. I didn’t get upone day and decide to go discuss anti-crisis measures. Troika reg-ularly participated in developing the rules of the game, because wehave a deep inner conviction that we can succeed only in a coun-try where the rules of the game are clear and where working con-ditions are civilized. This is the first thing. Second: under the condi-tions we have today a businessman cannot simply sit back and waitfor someone else to take up the problem and figure it out. Sinceeverything is happening so fast, you are obligated to take an activestance. A transformation of the system is taking place. Our experi-ence and knowledge are required, since we have a different takeon things than the government servants. They need to be informed,in order to make the right decisions. Could we be mistaken? Ab-solutely. Could we suffer as a result? Well, yes, probably we could.But if this is a reason to be afraid, it would be far easier to do noth-ing at all — it would be better to move to New Zealand and raisesheep on a farm. — But doesn’t it seem that Troika is thereby putting itself at oddswith the business community? People may have different re-actions to the fact that you ended up at the same place and timeas those who passed the anti-crisis measures, to the fact thatyou gave advice, as you admitted to just now. For example, theymight say: “Well well, they called him but not us. I guess he isbeing saved…”Absolutely! Rumors were flying that I was trying to secure moneyfor Troika. It’s funny. See, I didn’t just drop everything and run overthere, knocking and saying “Let me in!” Truth is, if the Head of Sber-bank of Russia, German Gref, had not called me, I would not havebeen invited. But this is beside the point. I think the reason why Iwas called to these hearings while others were not is that Troika isa role model to the stock market. We are an independent, profes-sional investment company, endowed with Russian and internationalratings and enjoying a good reputation. But we are not just a ma-jor player — there are plenty of those. We have always taken an ac-tive position, and Troika’s participation in a number of major proj-ects — industrial, social, educational — creates a different kind of at-titude toward what is happening in the country. This is why the weightof our words — and not just mine, but those of Pavel Teplukhin,Jacques Der Megredichyan, and Andrei Sharonov as well — standsapart. Rational people understand that our active participation in thediscussion of serious problems is not a banal attempt to lobby ourown interests; we have done a lot in the past for the overall goodand we will continue to do so.

“Only an idiot would act under today’sconditions as if nothing had happened.”— How has the crisis affected Troika itself? — The situation with our company is in fact far better than with themajority of our competitors. This is further proof that for several yearswe have strategically done a number of things properly. Now weare seeing the result. Did we make any mistakes? Of course. We cameout of this year in decent shape; despite the bad market, we madea profit before taxes and bonuses. True, we made less than planned,but the fact is we made money. We could have made more if it hadn’t




been for silly mistakes. We should have been more thorough aboutreducing on time our limits and our positions; we should have seenthrough everything we spoke about. Management could have madequicker decisions and not stalled; certain employees could have beenmore disciplined and more understanding of the consequences oftheir actions. In general, this is a good lesson for us: on the one hand,there is a sense of pride that we at least got through this difficultperiod better than our competitors who behaved aggressively onthe market; on the other hand, we also understand that we are notperfect.— So you are saying is that everything is alright. However, thereare persistent rumors that Sberbank is buying Troika. As every-one knows, right now is not the best time to sell. This means thecompany is being sold under duress, to save it from problemsresulting from the crisis. Isn’t that right?— And you too! I’ve answered this question plenty of times. All theserumors are pure nonsense. The thing is that I did in fact spend a lotof time at Sberbank, meeting with German Gref, and people prob-ably just didn’t understand why I was spending so much time overthere at a time when so much was happening here. The answerseems obvious: I’m either getting money from the Central Bank orarranging to sell the company. I will repeat: the rumors that Troikais for sale are ill founded. (One week after my conversation withRuben Vardanian I learned once and for all why he had spent so muchtime in recent months with German Gref: it was reported that Sber-bank had signed an agreement to a multi-million dollar credit — onlynot to Troika, but to the Skolkovo Business School — author)— OK, agreed: Troika is not in need of help. This leads to a ques-tion: what are the keys to its success, what allowed it to keeplosses to a minimum during the crisis? Was it the people, theteam?— The team definitely comes first. People showed their solidari-ty, as well as their desire and ability to work under crisis conditions.But, again, success is not a question of just a team, no matter howtightly knit. The entire system leads to success: firstly, it is the rightgoal, which you select and articulate. Second, the business mod-el, which you believe will lead you to this goal. And third, of course,the people that are placed within this model. It is quite important forall of this to be tied together.— What were the main highlights and disappointments of thisyear?— It is hard to pick out someone in particular, given the situation onthe market. But as for particular projects, there were definitely someexciting deals this year. For example, we made a significant contri-bution to reforming RAO UES of Russia. We completed a deal withAVTOVAZ that, in my opinion, was the most beautiful deal in all ofRussia, a true a win-win situation. We invested our entire private eq-uity fund, which, given today’s conditions, is saying a lot. We werevery active in trading; Troika was one of the leaders in every aspect.As for disappointments, we clearly lost some ground with our mar-ket share in mutual funds. These results could have been better. Inaddition, our experience communicating with a great number of clientsunder crisis conditions revealed certain points we could improve upon;we need to more thoroughly explain all risks to all clients — espe-cially the ones who took leverage and played with greater risk. And,

of course, there were also silly disappointments, silly mistakes thatshould not have been made, since all of us understood them be-forehand. The problem was just that certain decisions weren’t seenthrough to the end. Actually, I myself am to blame here; I probablydidn’t say the right words or fully explain myself. There really is noone else to blame.— Troika passed a long term strategy last year. Will there be anychanges?— The strategy will not change. However, the tactics will definite-ly be switched around; only an idiot would follow the same tacticsthat were planned last year, as if nothing happened. Yes, our strate-gic goals are the same. It’s a separate matter that the conditions havedrastically changed and that once we have definitive knowledge ofthe depth of the crisis it will be necessary to take one more look atwhere we are and what the given conditions are like. It’s possiblethat these goals will not be feasible within five years, but rather sixor seven. But our basic philosophy, the main hypotheses that we putinto our business and the switch from a product to a client modelthat we started and are actively pursuing — all of this is definite andremains unchanged. We believed this was right before, and we stilldo now. We are still planning to develop all of our business lines. Inparticular, we still have our eye on Ukraine and Kazakhstan. Eventhough the situation there will be extremely challenging, this is theright strategy to take. We see a lot of promise in our Asian vector:the mono-central world in which all currents first travel through Eu-rope and America before being redirected is giving way to a many-polar world. Asia will play a significant role in this process. This is whywe are diligently building relations with South Korea and China, cre-ating a position for Troika in

these countries. It was a great hon-or for me to be invited to join the Global Investment Committee un-der the President of South Korea, join the Board of Beijing Univer-sity in China, head the Russia-Kuwaiti Business Board; we have part-nerships with one bank in Japan and another in Singapore — we gen-erally believe that Asia is a very promising area to work in. — How about in Russia? How will Troika develop on the domesticmarket? Have any new opportunities taken shape as a result ofthe crisis?

— Absolutely, the market will offer different opportunities to differentgroups of clients — both during the crisis and after it. However, it isimportant to note that from the point of view of the client’s busi-ness very little has changed in terms of strategy, although the prod-uct line may be modified somewhat (which, incidentally, lends ad-ditional credence to the reorganization currently happening at Troi-ka). For example, it is clear that few IPOs will take place next year.On the other hand, there will be a number of consolidations,

“Clearly, our company will not be aggressively growing nextyear, and certain businesses will be conducted at lower vol-umes than before. However, new businesses may appear, andthese businesses will require new people”


bankruptcies, restructuring, etc. True, there will be no public mar-kets. However, there will be private placements. Therefore, our serv-ices will be in demand no matter what. The crisis also creates onemore fantastic opportunity — to conduct a “general cleanup” and clearthe house of general clutter. The crisis gives us an opportunity to takea fresh look at all of our processes and put them to serious analy-sis. All of this is for the best; we grew very rapidly over two years— in 2005 we had 450 people, now we have 1600 — and rapid growthlike this will clearly involve unnecessary expenses.

“A crisis is no reason to get carried away”— That brings me to what is probably the main question for Troi-ka’s employees. How will their own personal situation be affectedby the changes to the economy and on the market? Will salarybe scaled back? How about bonuses? Are layoffs in the future?— For better or worse, we live in the harsh world of capitalism, wherethe important thing is efficiency. It would therefore be misleadingand wrong to say that that we will not be cutting back on staff un-der today’s conditions. The same goes for bonuses; bonuses are pre-miums on the year’s results and on the work of the entire compa-ny — not individual work. Various situations are possible, but the im-portant thing is that these questions will be settled logically and

openly, not arbitrarily. We aren’t going to say “I’m not going to payand that’s final!” or “As of tomorrow, you, you, and you are fired!”We will base our decisions on objective factors concerning the out-side situation and the company’s internal tasks under the new con-ditions. Clearly, our company will not be aggressively growing nextyear, and certain businesses will be conducted at lower volumes thanbefore. However, new businesses may appear, and these businesseswill require new people. Certain divisions will be closed, while newones will be opened — this is a normal, natural process. — Agreed, the logic here is perfectly understandable. Then again,Troika just recently went through rebranding. Although I am anoutside observer, it seems to me that rebranding during timeslike these might cause a knee jerk reaction with the employees.“Of course they have money for this, as usual. It would have beenbetter to pay bonuses…” — I partially agree with you. Anything that seems like a frivolous ex-pense at times like these will cause people to talk. Here’s the ques-tion: how do you define ‘frivolous?’ Here’s the situation with re-branding: firstly, we were prepared for it back in May; we coveredthe expenses for it prior to the market fallout. Second, certain thingsare done for the long term perspective, rather than the immediateone. Rebranding was necessary; all of us understood this. We hada good logo that served us for 17 years, but the world changed agreat deal over that time. It became fundamentally more dynam-ic, mobile, and internet-oriented. We understand the direction theworld has taken. It was necessary to reflect this in our brand. True,we could have waited six months, but if everyone understands thisis necessary, why not do it now?— No, I am actually on your side. I also think that there was noreason to wait. As a matter of fact, it seems to me that if a com-pany sticks to its plans for rebranding during such rocky timesfor the market, it is further demonstration of the company’sstrength and confidence that things will be alright and that thecompany is here to stay. — That’s also true. As a matter of fact, I believe that a crisis is noreason to get carried away, cutting back on anything and everything.Just as it is not a reason to take up silly projects and spend moneyas if nothing at all is happening. You should have a good under-standing of what you consider vitally important and of what you canallow yourself and what you cannot. — How about you personally? How are you faring the crisis?You know, not bad, however strange that sounds. A crisis createsdrive; it invigorates you, giving you the opportunity to take a lookaround. I am a lazy person by nature, a strange confession for a per-son who works 15 hours a day, but a fact. During typical, calm pe-riods, it takes considerable effort on my part to motivate myself forthis kind of work. The crisis changes everything; it creates a tremen-dous amount of drive and spunk, since in this situation you have sure-fire motivation — to prove that you are capable of more than oth-ers. People apply themselves more during times of crisis. It is easyto understand who is who. For me, this is the best time to com-municate with people, to build something new, to change something— the situation creates these kinds of conditions. A crisis is actual-ly beneficial, so long as it doesn’t go on forever. It’s a good time toreevaluate one’s values.

We are now living in a different sys-tem of coordinates — some of the for-mer Wall Street maestros are gone,bedrocks of stability like AAA ratingshave weakened, confidence is lost inthe American financial system, as wellas in (déjà vu!) the classical canons ofrisk management. We discover Ameri-ca every day.

about last year


In Focus Annual results

Yuri Nechuyatov thinks over the 2008 fiscal yearand what might lie ahead

In all likelihood, a lot of insightfulbooks will be written about whathappened on the financial market in2008 and why. Everything will be crys-tal-clear to everyone — just not yet. Justone thing is clear right now — CharlesDarwin was right when he wrote aboutnatural selection. I guess if Mr. Darwinwere still alive he would add a few morechapters to his book — about the disap-pearance of banks. The case study wouldbe in the spirit of the times, with HenryPaulson in the leading role…

It’s incredible, by the way, that every-thing we “nurtured” during work on ournew brand — about the guiding hero,breaking through, being “the ones” —has played out in reality. After all, thiswas thought up before everything hap-pened in September… “When everyoneis taking cover from the wind, the oneslift their sails.” As it turns out, this ishappening right now!

On the verge of a new year, peoplegenerally talk about the year that was,about why it was memorable and whatwas good about it. So, this past year — Imean the fiscal one — will be remem-bered as curious and instructive. How-ever, some of our competitors will callthis year “fiscal” only in the loosest senseof the word.

notes from the

The financial year ended well for us.Following a 12-point earthquake, thehouse called “Troika Dialog” remainsstanding with the light inside turned on.When you consider the tens of billionsof dollars that international investmentbanks have written off, the fact that wefinished the year with a profit — how’sthat for a result! True, we have to payemployee bonuses but, even so, we stillwill have a profit!

I guess some of the things we didwere right, since our financial resultwithstood the weight of the crisis. Iam sure a lot was at play here. Onething is our strategy, which allows usto make independent decisions re-garding how to do business; ourmany-sided business model, in whichdifferent business lines provide rev-enues with diverse structures and“qualities” for Troika’s overall P&Lstatement; the outstanding results ofthe first half of the year, a 50% in-crease over the first half of FY 2007…

about the2008 results

Good thing we aren’t in the situa-tion of many other players, whenthe balance sheet seems to say “on theleft there is nothing right, and on theright there is nothing left.” However,we still face hard times, even if thingsdon’t get any worse. We need to re-build.

about thenew year


We have worked a great deallately with Standard & Poor’s,our ratings agency. Recent times havebeen no easier for them, I bet, as thefinancial institutions under their“tutelage” (many of them with rank-ings higher than Troika’s) have start-ed “popping,” just like bubbles in pud-dles of rain. However, despite all theunpredictability, the hysteric moodson the market, the silly rumors andthe political pressure, S&P has leftTroika’s rating unchanged and con-tinues sending the right signals to themarket, confirming that Troika isstill standing strong.

A new year — a new P&L. Seemslike yesterday — but a month has al-ready passed. Things are still tough onthe market and people are asking: howlong will this crisis last — two years orfive? What are we to do? We have 1300people and everyone wants to be paid.At least two things are clear. One — weneed to put all our efforts toward mak-ing money. Two — we have to say ‘no’to certain things…

Our attitude will be one of thekey factors to survival right nowand success in the future. This meansour attitude toward work, towardmoney, and toward each other. Thiscan’t be written in the ComplianceManual. However, if all of us put our-selves out there and give it our all —even if people may not see it — if wetry to provide support and back eachother up, if we treat money as if it wereour own, we will emerge with honorfrom any market situation.

We can’t lose touch with realitywhile wrapping up business planning.In particular, we need to rememberthat we don’t have any sponsors andthat we as a company live on what weearn (the phrase “eat what you kill”comes to mind). This means our ex-penses must be consistent with ourrevenues and that if we allow our-selves to live outside our means, wewill definitely be punished…

Inner discipline has been criticalfor us. Aleksandr Suvorov, the famousRussian commander, was right when hesaid that discipline breeds victory. Thosewho were lacking discipline were sold tothe first bidder. As for us, we were by nomeans impeccable — certain articles inour P&L statement for recent monthswere red (and cause for blushing), dueto occasional negligence toward limits,risk analysis, and the rules of trading se-curities. We have things to work on.

We fulfilled our operating expensesplan by 100%! We spent an enormousamount of money, as we actuallyplanned to do. It’s great that everythingfit into the plan. True, it’s slightly worsethat we failed to create the amount ofrevenue we had planned (for obviousreasons). Still worse is that we actuallycreated a plan in which expenses weresupposed to grow at a higher rate thanrevenue. This is still one more lesson forus, which we need to learn as fast as pos-sible.

A lot of the things we do are beau-tiful — take, for example, our RussiaForum in January, our new offices inLondon and New York, or the campaignto launch our new brand. And so, dearfriends, we’re used to having it all. Nowwe have to change our ways a bit…

The bottom line is that, figurative-ly speaking, we passed our quali-fying exams in September, and nowwe can take the final test. The numberof tests and the length of the session isanyone’s guess. Only one thing isclear — some people will fail and therewill be no second chances. Those whofail — to the exit.

So let’s do some serious study-ing. If we get ourselves ready —we will break through!

The

Sukh

oi S

uper

Jet

100

took

to

the

skie

s w

ith h

elp

from

Tro

ika

RAO

UES

of R

ussi

a

Sale

of a

50%

equ

ity

stak

e in

TG

K�9

to IE

S

$1,3

26,0

00,0

00

$1,1

66,0

00,0

00

Febr

uary

20

08

Sale

of 2

5%+

1 or

dina

ry

and

pref

eren

ce st

ock

to R

enau

lt S.

A.S

.

ОJS

C “A

vtoV

AZ”

Stra

tegi

c A

llian

ceRe

naul

t S.A

.S

NEW

YEA

R!

NEW

BR

AN

D!

№1 on

the

mer

gers

and

acqu

isit

ions

mar

ke

t.12

M&

Ade

als

tota

ling

$18

billi

on

The

Rus

sia

Foru

m: A

new

for m

atfo

rco

nduc

ting

busi

ness

even

ts


Business Annual results

Standout eventsand key deals 2008

At the end of every year we reach into the attic for those old, belovedthings — Christmas tree ornaments. We cover the tree with both oldornaments — the sentimental things we will never let go of — and newones alike, which we love for their sparkle and shine. This year waschallenging on the whole. However, leaving 2008 to history withoutparticular regret, we are even more pleased than usual that we held onto the prettiest things on our tree — our experience, our achievements,our deals, and most important, our independence. Since we kept all ofthis, next year we will break through no matter what!

TCP Grow

th2

fun

dto

tally

inve

sted

The launchof Ass

etM

anag

emen

tand

Private

Banking

Ukra

ine

and

Kaza

khst

an

Sale

of a

21.

27%

stak

ein

Bas

hkire

nerg

o

RAO

UES

$466

,000

,000

OJS

C “V

olga

Ter

rito

rial

G

ener

atio

n Co

mpa

ny"

(TG

K�7

)

$461

,000

,000

Initi

al P

ublic

Offe

ring

Priv

ate

plac

emen

t of 1

5% e

quity

in

Tra

nsCo

ntai

ner

sold

by

Russ

ian

Railw

ays

$ 31

7,00

0,00

0

OJS

C Tr

ansC

onta

iner

RAO

UES

Sale

of a

76%

stak

e in

TG

K-1

0 to

For

tum

Cor

pora

tion

$3,1

00,0

00,0

00

Crea

tio

no

fth

en

ewTC

PG

row

th3

fun

dto

talin

g$8

50m

illio

nTh

ele

adin

gun

derw

rite

r:14

bo

nd

ed

issu

es

tota

ling

78bi

llio

nru

bles

Bri

ngin

gto

geth

erth

ere

gio

nal o

ffic

esin

toa

sin

gle

reta

ilne

two

rk:

“Per

sona

lInv

estm

ents

”

Rus

sia’

sla

rges

tag

ent

netw

ork:

the

16bi

gges

tba

nks

–Tr

oika

’spa

rtne

rsto

dist

ribu

teou

rin

vest

men

tpr

oduc

ts

Inst

itut

iona

l Inv

esto

r“A

llR

ussi

aR

ese

arch

Team

200

8”

—2n

dpl

ace

inth

era

nkin

gof

Rus

sian

anal

ysts


This page, from leftto right:Vilik Grigorian,Elizaveta Kazakova,Aleksei Yasakov,Vladimir Efanov

Come and fly the friendly skies!A revolutionary step is under way at Troika — the company’s existing trading platform is being replaced by a newsystem, Murex. This project, started a year and a half ago, is so immense and complex that some might call it one ofthe boldest moves in company history. Very few platforms of this caliber currently exist in Russia. What exactly isMurex? Why do we need it? How does it work? For the answers to these and other questions, we turned to thosedirectly in charge — the Murex installation team. It’s their turn to speak.

What is Murex?

Vladimir Efanov, Head of Murex IT: The only way to explain Murex so that everyone un-derstands is to use analogies. Murex to me is like the control panel in the cockpit of anultra-contemporary fighter jet, the part of the airplane that tells the pilot (in this casethe trader) exactly where he or she is located in the flight route. Since the trader needsto make quick decisions, he or she must be able to see at all times the full range of in-formation on the instruments, meaning the numbers within a given position. This is espe-cially true these days, with the market behaving so unpredictably.

Polina Bolshakova, Murex Project Director: Murex to me is more like a LEGO set. It ismade up of different building blocks that allow us to “put together” the trader’s works-pace: customizing user screens, loading complicated mathematical formulas, program-ming various events in the “life cycle” of deals. True, this is not a building set for ama-teurs. However, once you reach a certain level of skill and experience, you will be in com-mand and have considerable advantages to work with.

Victoria Zasorina, Murex IT Business Analyst: The trading floor holds a number of in-formation systems: trading and data terminals, televisions and telephones, electronic bo-ards, etc. There are a number of ways for traders to close deals: terminals that are plug-ged into markets, telephones, vocally, between desks…. And all these deals from all

these sources need to enter one single sy-stem containing Troika’s entire position. Thissystem is Murex. The main requirement isfor it to demonstrate in real time all the va-rious profit and risk figures that help the tra-ders make decisions, rather than simply ar-ranging the numbers in a column, like theold system.

Konstantin Altukhov, Murex Project Di-rector: Murex is like a Rubik’s cube, whe-re each separate desk represents its ownpanel. The Murex system takes the tradingdesk to a new level, where it is possible toreact quickly and efficiently to the constantlychanging market. However, each panel-desk is followed by a second one. The im-portant thing is to be able to “connect” thenew panel without spoiling the old one.Whether the entire cube will come toget-her as a whole is entirely up to us.

Team Murex Project

One of Troika’s most ambitious projects, a new management and risk control system for trading.Installation now under way


“Murex is likethe controlpanel in thecockpit of anultra-contem-porary fighterjet, the part ofthe airplanethat tells thepilot (in thiscase the trad-er) exactlywhere he orshe is locatedin the flightroute”

This page, from leftto right:Nikolai Bragin,Polina Bolshakova,Konstantin Altukhov,Victoria Zasorina,Alexander Stepochkin

Why Murex?

Polina: The times create certain require-ments. Troika was and remains at the fo-refront of advanced technologies in in-vestment. We used to work with theKondor+ system but we eventually reali-zed that we needed something more.And we began to wonder what systemwe should have instead. We knew aboutMurex for a long time, we heard about itsgood reputation, which is backed up bythe experiences of the world’s leadingbanks. The system takes leading posi-tions within a number of ratings, particu-larly when it comes to derivatives andrisk management. In 2004, Jacques DerMegreditchian and Aleksei Tsyganok re-turned from the Murex headquarters inParis with a firm recommendation: “Troi-ka must have this platform.”

Vladimir: Many of Russia’s investment banks use low-grade systems. But if a bank wantsits trading desks to negotiate an enormous amount of information quickly and accura-tely and stay in synch with today’s bustling world of finance, there’s no way to get bywithout a system of this caliber. There are basically two options for improving automated trading: you can develop thiskind of system on your own or buy one on the market. Neither option comes with a 100%guarantee, but the advantage to the second option is that the system comes installedwith the mathematical models that are used in the banks where this system already exists.This means that the system essentially becomes the industry standard.

ScaleAleksei Yasakov, Murex Project Manager: We had a unique experience with implementingthe Murex system. Firstly, Murex had to contend with the particular nature of the Rus-sian market, devising additional settings and adapting the system to our specific mar-ket and instruments. Second, as a rule, installing systems this advanced involves a three-part team: the system’s manufacturer, a consulting firm, and the client. We worked di-rectly with the manufacturer, which entails both risks and advantages.

Polina: First I should say that very few people besides Troika have tried to install a fo-reign system this advanced, let alone without using consultants and without

PHO

TO B

Y: S

ERG

EY M

ELIK

HO

V



Team Murex Project

One of Troika’s most ambitious projects, a new management and risk control system for trading.Installation now under way

a representative office of the supplier in Russia. With the Murex project, Troika faces notonly enormous installation expenses, but also the daunting task of training and creatinga team of inhouse Murex specialists. Troika has just a little bit of time to reach the samelevel of expertise on Murex as the banks in London and Singapore where the system hasexisted for more than ten years.

StrengthsAram Badalyan, Senior Trader, Fixed Income Desk: As a trader, I see a lot of benefits.Murex, unlike a number of similar systems, is user-friendly. Every trader is able to in-stall the exact settings that are needed for one’s job. And, most important, this sy-stem shows two of the qualities necessary for trading — speed and reliability.

Konstantin: Murex offers an enormous amount of information for analysis. One thing youoften hear during implementation is: “I don’t use this now, but I will in the future.” Thesystem provides all the needed information at any given time and it can expand in thefuture as work begins with new instruments and new markets. Meanwhile, the abilityto integrate with the world’s major information systems makes Murex a powerful in-strument of analysis and position management. Murex should not be viewed as just aset of instruments put together under a pretty cover. Helping different desks reach newlevels of quality, Murex also grants us a unique opportunity — centralized risk manage-ment, not only at separate desks, but within Troika as a whole. Risk management is cur-rently becoming one of the key factors to Troika’s success.

ImplementationVladimir: It would be wrong of me to say that Murex was easy for us. However, oncea decision is made, there’s nowhere to turn. Not to mention, we swore to ourselvesthat we would make this system work. Probably the greatest key to success on a pro-

ject this complicated is the people workingon it. This means not only the IT specialists,but also the business analysts, supervisors,users, and, of course, the project sponsors.It is crucial for all team players to show mu-tual understanding and trust. Otherwise,there’s no way to get the system runningsmoothly, even a perfect system like Mu-rex.

Polina: What we are doing is implementingthe Murex system in stages — desk by desk.Implementing the module for each particulardesk begins with the collection and analy-sis of requirements, followed by configu-ration and customizations, integration withTroika’s remaining systems, tests, usertraining, and, finally, the actual launch.Furthermore, the wishes of the risk mana-gers must be taken into account before eve-ry launch. The risk managers are no less im-portant than the traders, since, in order tocontrol over risks, they must be able to seeall the positions and operations at thedesks.

Aleksei Yasakov: Murex performs calcu-lations at a cut above even the most ad-vanced operating systems. A simple

“Murex isuser-friendly.And, mostimportant, thissystem showstwo of thequalitiesnecessary fortrading —speed andreliability”

This page, from leftto right:Nina Fedosova,Evgenii Shagov,Elena Musatova,Victor Dvoryaninov,Alexei Matveev


This page, from leftto right:Anastasia Lebedeva,Alexander Bulanov,Anton Buev,Evgenii Panfilov,Andrei Bolotskikh

“Our task is tobe sensibleabout costswhile givingTroika a com-petitive edge,setting thetable for a ma-jor surge oncethe marketstarts toimprove”

example: the description of any bond inMurex involves dozens of different para-meters, not to mention the redemptionschedule, which may be programmed asmuch as 30 years ahead of time. All ofthese parameters allow Murex to calcu-late bond profitability, as well as variousnumbers that allow for comparisons bet-ween different bonds and instruments.Meanwhile, mistakes in bond descriptionsmay affect the digits shown throughoutthe entire system. For this reason, a newposition has been added to the tradingdesks — Static Data Manager. As for themore complicated valuations of options,Murex uses contemporary mathematicalmodels that quantify complex derivativeinstruments.

TeamPolina: We had just four people on our teamwhen we first started out with Murex. Ayear and a half later, our Troika group alo-ne consists of 15 employees, over 30 users,and a large team from the Murex head-quarters in Paris. Several Murex consultantswork in our trading business and are basi-cally a part of our company.

Viktoria: A job as complex as installing Murex is clearly going to involve certain problems.The project team occasionally has to work nights and weekends so that the traders canaccess the system in the morning and start their work. We had one incident where theentire team left for the evening, leaving only the system monitor, who was supposedto close the system. This procedure alone is challenging. Lo and behold, late at night thesystem suffered a failure. The employee contacted the consultants, sorted it out, elimi-nated the problem, and closed out the day…at seven in the morning. The traders arri-ved at eight and started their work as usual.

Up and runningAram: I was the first one asked to try out live operations with Murex. The bond desk wasthe first phase of the system’s implementation at Troika. The benefits are obvious. Whe-reas before we had to use several instruments to do our jobs — making charts in Excel,opening additional windows, even occasionally writing things down — we now have asingle system, which allows us at all times to see from every angle what is happeningon the market and what our positions are like. The important thing is that we can worka step ahead.

Polina: Work with bonds was started in May, not long after derivatives on interest ra-tes. A module to control market risks was launched during the summer. Pretty soon wewill launch options, as well as modules for the FX&MM and REPO desks. All we have left is the futures and stock desks. At first we planned to finish them andhave the entire system launched within two-three years. However, it looks as thoughour plans may change. Remember, Murex is the kind of system that users will alwaystry to perfect. I mentioned the constructor set for a reason. Murex offers unlimited op-tional possibilities. If you don’t stop on time, you could go on perfecting it forever. Ourtask is to be sensible about costs while giving Troika a competitive edge, setting the tab-le for a major surge once the market starts to improve.

PHO

TO B

Y LU

BO

V S

HEM

ETO

VA

(G

IED

RIU

S PU

KAS,

MIK

HA

IL B

RO

ITM

AN

, ART

YOM

YU

KHIN

); R

PG/C

OR

BIS

(1)

, FO

TOB

AN

K/G

ETTY

IMA

GES

(1)

; REU

TER

S (1

)

Troika’s titans of Private Equity share tricks of the tradeand the finer things in life


Profession Private Equity Manager

Every project is a miniature lifeMikhail Broitman is a Troika veteran. He joined the compa-ny 12 years ago. A student of mechanical engineering, Mik-hail graduated from the Moscow Institute of Railway andTransport Engineers with a degree in heavy equipment buil-ding. Following the institute, he spent time working in a con-struction bureau. However, he soon decided to become re-qualified as a broker. “I came to Troika in 1995 under the po-sition of…I don’t remember what it was called. It seems the-re was no name at all. Everything was just getting started,”Mikhail recalls. These days, however, Mr. Broitman’s spe-cialty is no secret to anyone — he manages Troika’s stra-tegic investments. He was a direct participant to the AV-TOVAZ deal, as well as to the deal currently under way tosell an interest in KAMAZ to the Daimler concern.

About AVTOVAZ The sale of a 25% interest in AVTOVAZ to the Re-nault concern created plenty of buzz, even among those far re-moved from the investment business. For Troika, the AVTOVAZdeal represents a whole new level. The company had previouslynever experienced any deals involving the transfer of billions ofdollars to a single account. Now we know that these kinds of num-bers are entirely within our capabilities.


The Titans of Private EquityThe Private Equity and venture capital industries represent the next major boom — something Troika is willing to beton. What is needed to take front stage in this business is a history of success and a solid reputation. Troika passes thetest on both counts. The record deal with AVTOVAZ, the outstanding success of the Evrokommerts factoring companyand URSA Bank, the creation of Russia’s first private-state venture funds — all of this was achieved by Troika Dialog’sPrivate Equity Group. What do the merchant banking “shark,” the private equity professional, and the venturecapitalist have in common? How are they different? In the following pages, the leading managers of Troika’s keybusiness lines will discuss their professions, as well as the things they enjoy in life. Here are their professionalportraits.

“The AVTO-VAZ owners-hip structurelacked trans-parency,which is whyinvestors werenot interestedin the compa-ny. We helpedsolve this pro-blem, conduc-ting a verycomplicatedmany-phaseddeal to elimi-nate mutualownership”

Not many people understand that we actually worked on this dealfor two years. The thing is that the entangled cross-ownership sy-stem between AVTOVAZ and its subsidiary companies was a dif-ficult obstacle to overcome. However, this was necessary for ope-ning the company to capital markets. The ownership structure lac-ked transparency, which is why investors were not interested inthe company. We helped solve this problem, conducting a verycomplicated many-phased deal to eliminate mutual ownership.

About success Luck is important for our profession. It is importantto come out with the right product at the right time. Тhe same goesfor the sale of the AVTOVAZ ownership interest. Troika sold a 25%interest in the company for $1 billion. The market situation rightnow has changed considerably, and although the companies areperforming no worse, predictions regarding the future have beenturned around and companies’ estimated values have been lo-wered.

About personal good fortune I’ve been blessed with good fortu-ne on several occasions. This first instance was in 1991, when I gota job at a joint enterprise as a broker on the merchandise and rawmaterials exchange. This was a major step for me: from engine-ering into commerce. The next time I lucked out was when I cameto work for Troika, rather than somewhere else. The rest of myluck happened here at Troika.

About the strategic vision Vision — this is a significant part of su-ccess. Suppose that everyone thinks a certain company is weak,and that it isn’t going anywhere. But you see and understand thatin a few years the situation will change and that the company willget strong and become a serious market player. This was the casewith KAMAZ, for example. We entered this project in 2004, whenthe company was close to bankruptcy. It faced an enormous amo-unt of debt, which it barely managed to restructure. There was mi-nimal growth in output. The company balance was barely makingrecovery. However, Ruben was able to see the company’s potential.Our participation in this project is basically because of him and hisvision.

About preferences at work Each project is its own little life, newpeople, new tasks. With each new project you find a new situa-tion. You need to constantly think about the strengths of each par-ticular company, as well as the weaknesses, how to help, whatneeds to be done, etc. With each new project I take on a new ex-perience, learning how to be an entrepreneur in a new industry.

About plans for the future We plan on creating a core group ofauto components makers, which will service Russian factories, as

Managing Director,Merchant Banking,

Troika’s Strategic projects


Private Equity is no Placefor Showing Off Giedrius Pukas served as President of Lithuania’s EquestrianFederation until October, 2007. However, despite his lovefor horses, Mr. Pukas is perfectly clear about his main hob-by — his job. “The more work I do in private equity, themore I like it. One of the most pleasant feelings for me isto see people I worked with in 1998 and find out that theyhave big, successful companies and that everything is goodin their life,” he says. Giedrius joined Troika early in 2004.Now he is in control of two private equity funds — a thirdone will be added soon.

About the need for private equity funds Every company goes thro-ugh different phases of development. Not all of them are growthphases. Take a look at America — one big company after

well as all the manufacturers who come to Russia, like Toyota,Volkswagen, etc. In all likelihood, we will choose to create a jointenterprise along with one of the global auto parts manufacturers.Some of the assets will be bought on the market; some assets forthe joint enterprise will come from AVTOVAZ and KAMAZ. A cer-tain share of this consortium will belong to Troika.

About partners Troika always tries to enter projects with partners.Basically each one of our investments is a consortium of investors.The recent deal to acquire an interest in First Quantum Ports wasalso a joint investment. Our partners are shareholders in First Quan-tum and Fesco. For our partners, Troika’s participation guarante-es that the best specialists on the financial market will be wor-king to improve company capitalization. However, we do not wantto be a single shareholder, since we are not prepared to act as ma-nagers within certain industries — manufacturing, for example. Webelieve that everyone should do what they are good at: mana-gers should manage the company, while Troika should guaranteeits success on the financial market.

About global ambitions Only one thing is currently separating usfrom the leading global investment banks — volumes. They havea global sales network, which allows them to raise the large sumsof money from the market that are necessary for company de-velopment. The global banks are capable of providing billions ofdollars in financing. We are currently handling deals in the rangeof $100mln — 1bln. If we see through all the plans we have to buildour client base, we will have $20–30 billion under management,which will help us raise financing for big projects within major com-panies. According to our strategy, we will grow as the wealth ofour clients grows. There is no reason why we shouldn’t set $20–30 billion as our target.

About professional preparation The basic idea is that we are in-volved in buying and selling companies. For this reason, the pe-ople working in our division have considerable experience in mer-gers and acquisitions. We have two individuals in our departmentthat were big-name lawyers in the past: Galina Nesterova and Ma-rina Kravchenko. They previously handled legal oversight for ourInvestment Banking. Then they expanded their qualification. Eve-ryone else in our department came from companies directly in-volved in private equity.

About sports and smoking I quit smoking last year in August asa kind of birthday present to myself. I wanted to do this for a longtime, and then a really good reason turned up. My friends and Iwere planning to ascend Mt. Kilimanjaro and I needed to get inshape. So I quit smoking and started working out. Now I go to thegym two or three times a week.

About mountains After Kilimanjaro, I fell in love with mountains.My wife and I were planning a trip to Tibet this summer, but it didn’twork out, since the Chinese border was closed for the Olympics.Instead, we went for a hike in the Altai Mountains and coverednearly 100 km on horseback. The feelings are magical:

mountains all around, alpine rivers. Your concerns about work areleft far behind. Not to mention the fact that your cell phone do-esn’t work.

About books I love reading and I read a lot. As far as work-rela-ted books go, I mostly read investment cases and the business pub-lications put out by Troika. As for literature, I’m a big fan of Pele-vin and Lukyanenko. Lukyanenko, in my opinion, carries the mant-le of the Strugtskie Brothers, while Pelevin is more into mysticism,not unlike Bulgakov. These books break the reader’s home-workrhythm and open new horizons, if you pardon the expression.

“Troika’s repu-tation helps alot. When Imeet withpotential inve-stors, theyalready knowthat Troika is amajor, cuttingedge companywhich isalways thereto help andinform”

Managing Directorof Private Equity Funds,Troika Capital Partners




another is going bankrupt. A certain class of investors exists thatspecializes in just these companies, buying up victims of bankruptcy.Troika works with companies that are going through growth pha-ses. This is the phase when the company stops being a toy for theentrepreneur and becomes a serious business. Suppose a youngman borrows some money from his mom and dad and builds abusiness. Now he wants to take this business to the next level.Instead of one shop — 10. Or instead of 10 — 100. This will requi-re an investor who knows what to do each step of the way andis able to help with money and advice. Troika should be this in-vestor.

About specialization Our funds specialize in the consumer sec-tor and companies that are experiencing growth. It’s a rather nar-row specialty. On the other hand, I think the major problem withthe new teams on the market is that they actually have too wideof a strategy. You see, Russia is for investors what a candy shopis for kids. Once you have arrived, you immediately want to buyreal estate, land, forest, internet companies, retail, and thebanks. However, it seems to me that it is impossible to know eve-rything at once about all business lines.

About the consumer sector We first and foremost look into in-dustries that relate in one way or another to consumption: fi-nancial services, retail, medicine, and specialized media projects.There are two reasons for this. Firstly, this is where the quickestgrowth happens. For example, our portfolio last year consistedexclusively of companies looking at a minimum of 50% growth.The second reason is that we have already created a name forourselves in the consumer sector. Troika was largely responsiblefor creating this industry. For example, one of our investments,Eurokommertz, is already Europe’s third largest factoring com-pany.

About fund names Our funds are called TCP Growth1 and TCPGrowth 2. We’re pretty much through with building TCP Growth3. We gave the fund we launched with Singapore’s Temasek Hol-dings a rather unsubtle name — Russia New Growth. After thatcame the New Russia Growth Fund, and then another and anot-her. We therefore decided to go with a more sophisticated title,but we left the word ‘growth,’ in order to emphasize the fact thatwe handle rapid growth companies. All companies are owned bya fund. Decisions are made by an investment committee that in-cludes investors’ representatives.

About the third fund Right now we are finishing work on thethird fund, which will total $850 million in volume. It will inclu-de all the same investors as the second fund, plus a few newones. We are thinking about inviting several state-controlledfunds, as well as investors from the Middle East and the U.S. This,by the way, is a pleasant surprise. I thought that during the cri-sis the Americans would forget about anything and everythingbeyond the borders of their own country. It turns out that thereverse is true. They are more and more realizing Russia’s po-tential.

About ownership interests Our funds take a minimum of 25% anda maximum of slightly more than a blocking interest. We are cur-rently thinking about acquiring a 67% ownership interest in oneparticular company, but we would gradually surrender a portionof this stake to management. The logic is simple: our partners sho-uld have an interest in developing the business.

About Private Equity philosophy When you work in a company,you think like a manager. You think about how to optimize ma-nufacturing and raise sales. I like to think about turning the com-pany itself into a sound product.

About partners One of the most important things in Private Equi-ty is to choose the right partner. Each side must have a clear un-derstanding of what it expects from the other. Of course there aredisagreements, but they tend to be work-related and easily re-solved. Since first taking up private equity in 1998, Troika has ne-ver experienced any disagreements that have gone as far as thecourts or turned into some kind of corporate conflict.

About showoffs Private Equity is not a place for showboating. Ro-lex watches and Patek Philippe won’t impress anyone. What yourpartners are interested in is how well you understand their busi-ness. They couldn’t care less how you are dressed — the impor-tant thing is to speak their language. As for the investors, they lookat achievements. It’s all very honest: if you make money, peop-le will invest in your fund. If you don’t make money, don’t expectinvestments.

About socializing outside work Our funds make long term in-vestments — as a rule, close to five years. I regularly keep in to-uch with the managers and owners of the companies we investinto, so a good rapport is bound to take shape. Sometimes I getthe most unexpected requests. Actually, just now I got a text mes-sage from one of our partners. He wants to know if his daughtercan go horseback riding on Sunday.

About investors I know all of our investors by face. There’s notthat many of them. The pool of investors in TCP Growth 2, forexample, includes 18 individuals from the West and five from Rus-sia. It should be noted that Troika does not use intermediaries. Themost important thing for us is to understand who we are workingwith and whose money we are managing, just as the investorswould like to understand who is handling their money.

About Troika’s image No doubt about it, Troika’s reputation helpsa lot. When I meet with potential investors, they already know thatTroika is a major, cutting edge company which is always there tohelp and inform. Investors who work in Russia know of Troika asa local player that will not play any tricks.

About the year’s results Unfortunately, the 2008 results are ex-periencing a correction. It was a difficult year for the world in ge-neral — we were no exception. All the same, things aren’t that badfor us or for Russia in general. GDP is on the rise, as well as

“It was a diffi-cult year forthe world ingeneral — wewere noexception. Allthe same,things aren’tthat bad for usor for Russiain general”


Wider palettes are more interestingArtyom Yukhin is no stranger to innovation — he built se-veral successful high-tech companies from scratch. He isalso the inventor of biometrics technology with 3-D faci-al recognition that is now an international standard. Hecame to Troika under the condition that he stay on as di-rector of his own company, Artec Group. “Frankly spea-king, I am an entrepreneur by nature. I never thought I wo-uld work for someone else. Working at Troika became theonly possible compromise,” he says. Artyom is currentlymanaging three hybrid private-public sector regionalventure funds.

About choosing an employer The truth is that I received a num-ber of similar offers. When the government — the Ministry of Eco-nomic Development in particular — devised the hybrid private-state partnership framework for developing innovative companies,a number of firms were suddenly created that chased after the-se state funds, appropriating the term ‘venture capitalism’ alongthe way. What I wanted to do was develop a venture business rat-her than simply appropriating the budget. That’s why I came toTroika. It was clear to me that this company was interested in ma-king venture investments for longer than just one year. I’m surethat Troika would be investing into innovative technologies evenwithout state participation.

About Troika as a startup Troika is a classic startup. The com-pany was founded by people who became brokers at a timewhen Russia had no stock market at all. They had a vision and

“It is my per-sonal dreamthat within 5–7years thewords ‘invest-ment’ and‘advancedtechnologies’will causeeveryone tothink of Troikafirst”

consumption. The price on oil remains high and a lot of money iscirculating. Although things are rocky — again, like they are el-sewhere — companies still need credit and financing, while rai-sing money has become far more difficult. This means we haveto help out our clients even more and put our weight behind them.Now is not a time for rest.

About payouts to investors We invest into companies. We helpthem get on their feet, and then we gradually leave the business,selling our interest. So long as we have not returned all of the in-vestor’s money, we do not accept any kind of reward. In theory,if the company issues shares during the investment period we canreturn the investors’ money and reinvest the profit. However, inpractice this has never happened. Investors want their principalreturned with a profit.

About entrepreneurial philosophy Our work is fundamentally dif-ferent from the work of an investment banker. In investment ban-king, you provide consultation on the purchase or sale of a com-pany. What we do is join the company and literally live inside itfor an extended period. We are responsible for the company’s in-ner workings and its future. Every project is a test for our in-vestment policy: was it right to invest in this company? Did wechoose the right partners? This isn’t how a financier thinks — it’show an entrepreneur thinks.

About Kissinger and diplomacy These days I have been readinga lot about history and politics. One of the best books I have readin recent years is Diplomacy, by Henry Kissinger. I happened to at-tend a dinner where Mr. Kissinger gave a speech. Of course I knewhis name, but I had no idea what kind of person he was. As it turnsout, he’s a wise old man. His book convinced me of this even more.

About horses I’ve been a horseback rider since I was a teenager.Dressing-out is more interesting for me than jumping. One rea-son is that I can only jump one meter twenty high, and I only jumponce, not in a series. The great thing about dressing-out is thatthe horse does exactly what you want it to do. If you want a shor-ter step, you can make the step shorter, you can go at a short gal-lop, long gallop, gallop to the side, etc. If you compare it to dri-ving, the best example is aerial acrobatics, where you not only turnat high speed, but you do it gracefully.

About Count Dracula I’m particularly fond of Coppola’s Dracula. Ifyou strip the film of all its horror, what you’re left with is a beau-tiful love story and the idea that true love never dies. I was ho-nestly surprised. I never thought that I could view Dracula as a per-son who would sacrifice everything for a woman. Dracula is usu-ally a monster.

About children My son was born last year in September. We na-med him Vladas. It was a major revelation for me to learn that Ilove children — a truly fantastic feeling. To be honest, when I wasyounger I thought I would always live alone. Time put everythingin its place.

Director of VentureFund Management,

Troika Capital Partners




an idea, and they were ready to work hard to fulfill it. This me-ans Troika is similar to many high-tech companies, many ofwhich start out from scratch. The way I see it is that a startupis a breakthrough, a business that is built upon high ambitions.This requires unique solutions, faith in the potential of the pe-ople working for you, sleepless nights, a lot of smoking, drin-king liters of coffee, etc. The surprising thing is that Troika haskept this spirit to this day.

About personal interest The reason I like working with ventureinvestments is that it allows me to look into different technolo-gies. When you are raising your own product, you are restrictedby the fact that it is your own and you thought it up. It gets moreinteresting with a wider palette.

About beginning work Believe it or not, a company in the star-tup phase is actually similar to a company in bankruptcy pro-ceedings. This means that we as professionals somewhat re-semble bankruptcy commissioners. The difference is that ourwork is more complicated, since many companies lack paper-work management, appropriate separation of functions, acomplete staff, and lots of money. Although the company mayhave a spectacular team of scientists and some fabulous tech-nology to its credit, they might also have no clue about marketingand business development. Our job is to look for partners, con-duct hiring, and optimize business processes. Basically until theentire team is assembled we have to conduct most of the ma-nagement.

About the difference between venture funds and Private Equi-ty Private equity funds invest into companies that are alrea-dy making a profit. It is possible to estimate the company thro-ugh discounting cash flows or certain other methods. Analy-zing the company involves looking at its strategy, what thecompetition is doing, and how the market is developing. In theventure business, money is usually invested into companies thatare not making a profit. However, they have plenty to offer.This might be an idea, a patent, or certain key employees. Theywill definitely have a business plan and some kind of idea abo-ut what it is they want to sell. All of this might change over ayear or two — the market, the product, the cost. All of thesefactors are basically impossible to calculate by the traditionalmethods.

About the funds he manages We currently have three regio-nal venture funds under management: Moscow Oblast, the Re-public of Tatarstan, and Krasnoyarsk Krai. The three funds to-gether total $50 million. The investment framework goes as fol-lows: 25% of funds comes from the federal budget, 25% co-mes from the region — which won a competition for the rightto this fund — while the remaining 50% Troika raises from themarket. If we invest into all the companies we have planned,our investment portfolio by the end of the year will include 8–9companies. We have been working on these deals for the pasttwo years.

About plans for the future Our goal is to become player num-ber-one on the high technologies market and make blue-chipcompanies out of the firms we are currently investing into. Itis my personal dream that within 5–7 years the words ‘invest-ment’ and ‘advanced technologies’ will cause everyone to thinkof Troika first.

About investment strategy Our plan is to make 80% of our in-vestments into IT firms that work on the fast market and are notknowledge intensive. This basically means internet projects orbusiness automating projects. The remaining 20% of investmentswill be made into knowledge intensive projects that are still inthe early stages, when nobody is talking about sales but the com-pany is dealing with revolutionary discoveries that show seriouspotential.

About the latest investment We invested into iiko, a new pro-ject by David Yan, the founder of ABBYY. Mr. Yan decided toopen a restaurant and cafe as a side project. Pretty soon herealized that he was working with inferior, outdated software,as is the case with most restaurants these days. This is whatled him to create iiko, a management system for the restau-rant business. Consumer sector businesses are currently bo-oming. Automated systems are something all of them could use,as the competition is getting stronger and businesses need tobe more and more effective.

About cartoons and movies I haven’t had TV at home for thepast 15 years. Thankfully my wife is not a big fan of TV either.What we do instead is we watch movies at night with a pro-jector and a big screen. Kim Ki-Duk simply amazes me. Out ofhis older films I like “Spring, summer, autumn, winter…and aga-in spring” and the utter fantasy of “Empty House.” I also real-ly like Miyadzaki and the Ghibli studio — these cartoons fall welloutside our Western perception. The subject matter is totallydifferent.

About classical music My wife is a famous violin player. We holda lot of concerts at our home. We occasionally have musicians fromleading orchestras come and play live music. Sometimes it’s clas-sical, sometimes even jazz. The sad truth is that most people thinkof classical music as something dead and forgotten. I am not oneof them. I think classical music is alive and well.

About his baby-world traveler Our son was born in May. Hestarted traveling in his first month. My wife won a major mu-sical competition in Japan and was supposed to play in concertswith local orchestras, as well as write several albums. There wasno way to back out. I took a week’s vacation from Troika andwent with her. We were very nervous about how the baby wo-uld handle the trip. However, all the way from Moscow to To-kyo he was pleased as could be and did not cry even once. Nowhe travels the world with my wife and a nanny. He has alrea-dy been to Japan, Switzerland, and England. He will certainly seemore than that.

“A startup is abreakthrough,a business thatis built uponhigh ambitions.This requiresunique solu-tions, faith inthe potential ofthe peopleworking foryou”

By the way, I’m meeting most of them them for the first time.Somehow I know almost nothing at all about the life of thiscompany branch. It’s a unique place — I guess the city has

rubbed off on the group and their habits. I’m traveling by taxi: historical portraits are flashing by outside thewindow — first the Anichkov Bridge, built in 1715, followed by thestone walls of the Petropavlovsk Fortress, the first building in Pe-tersburg. The city of rain and white nights, drawbridges and fo-untains — it’s the same city it was several decades ago. It’s easyto forget what year you’re in. Today, Troika has four offices in St. Petersburg. The central office islocated in the Petrovsky Fort Business Center. This is where most ofthe important meetings with company clients are held, as well as in-ternal meetings and conferences. I have an entire day planned here. I like the location, right along the Neva and directly across fromthe legendary Aurora cruiser. The river symbolizes change, while


© T

RO

IKA

DIA

LOG

PH

OTO

BA

NK

the cruiser — victory! Yes indeed, we will break through! Troika first appeared in Petersburg in 2001, opening on Malaya Mor-skaya. At that time, Troika Dialog St. Petersburg employed all offour people. These four people together built an investment bu-siness. Receiving a little bit of support from Moscow, they ne-vertheless did most of it on their own, brick by brick. The Petersburgbranch now employs 41 people. These days, the branch is wor-king through the times of global changes — never a dull moment.Writing a report at a time like this is a difficult task, involving manyquestions, and even more answers.But let’s not get ahead of ourselves. Standing near the “River of Time”sculpture in the business center, I am waiting for Olga Zolotareva, As-sistant Director of the office. Olga has a great idea: without explai-ning anything, she simply lets me plunge into life at Troika St. Pe-tersburg, letting me taste it on my own. Three guides will help me alongthe way: Andrei Belyavsky, Dmitri Nedumov, and Igor Vasiliev.

In Focus St. Petersburg

Special Reportby the Troiker Correspondent Maria Zalunina

Troika on the Neva. We will break through!It’s early one autumn morning. Still not fully awake, I shield my face from the windand the moist rain. Suddenly a verse comes to mind, written by my favorite poet,Alexander Pushkin: “A melancholy time! So charming to the eye!” Hello,St. Petersburg! This is my birthplace, a truly fascinating part of the world. However,I’m not here for the city. I’m interested in something else — Troika Dialog’s St.Petersburg branch. Without further ado, I present a typical day for our colleagues inthis city.

These days, ourSt. Petersburgbranch is work-ing through thetimes of globalchanges —never a dullmoment.Writing a reportat a time likethis is a difficulttask, involvingmany ques-tions, and evenmore answers


7:30 The kitchen is the place to be early in the morning. This is whe-re the new day gets its start. The very first comment I overhearspeaks volumes about this group: “I love reading up for the FFMSbasic exam the shore of the Neva, when the sun is just comingup and the light is bouncing off the waves near the Aurora,” saysOleg Gorbachev, an Investment Consultant. You feel the city’s po-wer and freedom.” Everybody sees that I am surprised. “Well, Masha, welcome tothe capital of culture — we have our own ways,” they joke. Mycolleagues are exchanging news, having discussions…no, not theglobal financial crisis, but the Oginsky Polonaise and the smokeabove Isaakievsky Cathedral. “The crisis is a temporary thing,”they say. “It’s possible to overcome challenges, just think abo-ut the eternal.”

8:00The office is coming to life. A telephone conference about quar-terly results is just beginning. “We already know the results; they’relisted on the Intranet,” whispers Olya Zolotareva. “But it’s alwaysnice to cheer for your colleagues. Listen, they’re about to anno-unce our Zhenya.” A regular winner of quarterly prizes, Zhenya Lipchina, Senior Fi-nancial Consultant, this time is being recognized as the most pro-ductive financial consultant. As soon as the conference is over, eve-ryone shows their delight, gleeful as children. Zhenya gets a goldstar, cake, and flowers — it’s her day. “It’s a pity that Ira Tsvet-kova is on a trip,” says Zhenya. “She won in two nominations.”Incidentally, St. Petersburg’s group of financial consultants has forthe second time been recognized as the best regional team.

9:30Everyone scatters to their desks, while I follow after Andrei Be-lyavsky, the main strategist at Troika Dialog St. Petersburg and theDirector of the North-West region. Andrei is relatively new to the company, having started just a few

months ago. However, he is a 16-year veteran of the financial mar-ket. He understands what to change and how to work. His goalfor Troika is greater efficiency and outstanding results. “Serious changes are under way in the life of Petersburg’s Troi-ka. The important thing is that one month ago we really and tru-ly became united. Now the entire team is working under a sing-le roof. This is important for building teamwork.” Andrei tells me about the structure of the branch. He has two de-puties: Dmitri Nedumov, formerly the Investment Company Director,and Igor Vasiliev, formerly the Director of Retail Sales. This tan-dem makes for the strongest retail engine available, not to men-tion qualified mentors to the junior sales specialists.

10:30 Andrei gets started with internal meetings. A true team builder,he spends the first half of every day meeting with employees. Dima Nedumov spends just about all of his time working with col-leagues. His number-one task is to bring in more clients to open brokera-ge accounts. Dima was the Investment Company’s first Sales Consultant in Pe-tersburg, a major player in getting the business off the ground. Heworks with the majority of Troika’s institutional clients in the North-West region and the Baltics. He took on even more responsibili-ties in 2005, when he became Branch Director. A combination ofexperience and connections helped him make Troika St. Peters-burg the number-one branch for work with major institutional cli-ents. “We always tell private clients about all our products, pointing outall the strengths and weaknesses. This is how we have always wor-ked. Nobody wraps themselves in a blanket, preventing Asset Ma-nagement clients from switching to brokerage, and vice versa. Buta small amount of competition was inevitable. However, now weare a 100% united team.”

12:00Igor Vasiliev just got back from a meeting with an important cli-ent who has worked with Troika for three years. At today’s me-eting, Igor told him about new investment opportunities under to-day’s market. — Igor, even with so much happening here in the office, you stillfind time to meet with clients in the city. Doesn’t it get stressful? — In my opinion, you can’t teach sales without doing sales on yourown. Hopefully, when things work out for me it can serve as anexample for others.

13:00Most of the staff has left for lunch.Early this morning I learned from Olga Zolotareva that Petersburg’sTroika is a real family. With each passing minute I become moreand more convinced that this is true. Honestly, what a surprise!Maybe the reader disagrees — after all, a lot of colleagues havelunch together. But get this — in Petersburg they go on vacationtogether! They go to movies, hold theme parties on Fridays, andgo out for a barbeque or bowling once a quarter. They do eve-rything together.

Dmitri Nedu-mov, formerlythe Invest-ment Compa-ny Director,and Igor Vasi-liev, formerlythe Director ofRetail Sales,are Andrei Be-lyavsky`s de-puties. Thistandem makesfor the stron-gest retail en-gine available,not to mentionqualified men-tors to thejunior salesspecialists


General impressions of the citySt. Petersburg is a city with a glorious pastand a glorious future. It’s both a city and a museum, wheremagnificent palaces and spectacular mo-numents border with contemporary arc-hitecture. It’s a city of embankments andbridges, with its own rhythm of life, a pla-ce where a person can truly relax. Thisis my native city. It totally matches myinner energy. Gracious, talented peoplelive here.

Favorite placesAlong the Griboedov Canal, near the Savior on Blood Church. I also like the Sum-mer Garden, the Arts Square by the Russian Museum, Petropavlovsk Fortress andthe Peter and Paul Cathedral, and, of course, Palace Square.

What is the first thing you would show guests tothis city?Isaakievsky Cathedral, the monument to Peter I —the Copper horseman on Senatskaya Square on theAdmiralsteisky Embankment, Palace Square, theWinter Palace and the Hermitage, a walk along Ne-vsky Prospect, white nights and the drawbridgeson the Neva — all of this is essential for a full im-pression of Petersburg. The best time to see it all

is during white nights, from May 20th until the end of June. This is when the citytruly blossoms, when it reaches full splendor… Petersburg is a maritime city, so it is best “viewed from the water,” which you cando by taking a boating trip along the city’s canals and rivers, watching the maje-stic raising of the Nevsky bridges, exiting into the Finnish Bay and making a stopat Petrodvorets.

Favorite restaurant / Favorite dishI would say the “Flying Dutchman” restaurant — a sailboat with three masts, a copyof the 30-cannon Dutch frigate “Amsterdam,” built in 1748. It’s anchored near theMytinskaya Embankment and across from Vasilievsky Island. The food is good, witha great view of the Neva, the Winter Palace, and the Rostralnie Columns.

What souvenirs to buy in St. Petersburg?A work of art by one of the local masters — cityscapeswith palaces, architectural monuments, bridges andembankments. Also, don’t forget the famous Lomono-sov porcelain.

“We love playing paintball,” says Igor Vasiliev. “But, you know, the-re is one problem: when it comes time to shoot, you suddenly re-member that your friends are on the other side. The rifle seemsto drop on its own.” Over lunch, all of us decide to go to the movies after work. Myfriends talk it over and decide upon the theater next to the trainstation, making it easier for me to catch my train.

14:30The activity in the client zone clearly picks up at this time. One ofSvetlana Yashina’s clients is signing documents for internet-tra-ding. Sveta tells him how to install Quick on his computer. “Right now many people are interested in internet-trading,” Olyatells me. “Last quarter we received 43 new clients. Financial know-how is clearly on the rise and more and more people are readyto test the market. The seminars we hold every week always drawa crowd. Just wait, you’ll see for yourself!”

16:00 Everyone is celebrating the opening of a new client account. Lo-oking to encourage his colleagues in their competitive spirit, Dimahas ordered pizza for the Petersburg desk. Meanwhile, we con-tinue our conversation. “Working with clients in Petersburg is a form of art,” says Dima.“You can’t behave aggressively here. You need to work like anintellectual. Right now I am trying to teach this to my colleagues.”

17:00 Igor Vasiliev chimes in: “It’s hard to take the Petersburg client bystorm — these aren’t emotional people, the kind that buys into the

In Focus St. Petersburg

Special Reportby the Troiker Correspondent Maria Zalunina

Guide to the cityby Andrei Belyavsky,Regional Director


whole “buddy buddy” thing. The trick is to follow “courtesies” andget the client to like you first. This requires etiquette, intellect, andprofessionalism.”

17:30 Andrei Belyavsky has a meeting to attend with a business partner.“I kept a number of clients and partners from my previous job. Wehave meetings almost every day to discuss new opportunities. I tellthem about Troika’s results and new products. I know what their in-terests are, so it’s easy to find new ways to team up.” Alexander Anatolievich is one of Andrei’s old acquaintances and Pre-sident of the St. Petersburg Managers and Developers Guild — a bigname in real estate. As you might expect, these longtime friends be-gin by discussing what interests them most — finance and real esta-te. However, Andrei and Alexander soon turn their discussion to the“Commercial Real Estate” Fund, which is currently raising funds forinvestments into St. Petersburg’s real estate market. Although Alexander has left, Andrei continues ruminating over thefuture of Russia’s stock market. “I’m sure that the financial crisis willlead to new economic possibilities for Russia. For me, it’s a great chal-lenge that I came to the company at such a time. We need to figu-re out what steps to take to make sure that people come to us forfinancial help. What a unique opportunity — helping to reengineer abusiness!”

18:30 Andrei has yet another meeting to attend, while I need to hurry —the seminar on Internet-trading in the Liteiny office has already be-gun. I ask the driver to pull over near Griboedovsky Bridge. As I re-call, several people in the office mentioned this as their favorite spotin the city. I pass by Marsovo Field and come to a stop near the Sa-vior on Blood Cathedral. A chilly breeze picks up and sends bright lea-ves tumbling into the dark river. Here is eternity, a powerful yet cal-ming force. The sheer history is overwhelming. How many more up-heavals will these waters see?

20:00 Even though it’s dark, Troika’s office is visible from afar, brightly glo-wing at the end of the street. Fourteen pairs of eyes are fixed upon Zhenya Lipchina. Our most pro-ductive regional Financial Consultant (by last quarter’s results) is hap-py to answer all their questions: — Absolutely, you can place a stop-loss order and a take-profit or-der on one security at the same time, but keep in mind that you mightaccidentally create a short. — Definitely, turn off your computer whenever you want. Troika willstore all the information regarding your operations and requests, soyou can save on electricity.

21:00 The audience has dispersed, happy with the lesson. I overhear la-ughter at the door — a client has asked Zhenya about the “first nightrule.” “This is one of our traditions. You see, the consultant whoserves you will be the same one you first spoke with about Inter-net trading.”

Zhenya and I head for the movies, running quite a bit behindschedule. Fortunately Zhenya is a skillful driver, deftly hoppingbetween lanes of traffic: “I’ve been at Troika for two years. Itreally surprises me when I hear that someone has left the com-pany. I mean, what could possibly beat working here?”

23:00We cap off the evening in a cozy cafe. My new friends are quiz-zing me about Troika in Moscow, wondering when rebranding willreach the Petersburg offices. All of us would like to know whenwe will see each other again. I guess we will have to wait for thenext Summer Outing in Moscow. On the other hand, why not meetat New Year’s? My friends have a farewell gift for me, a mug fromthe Lomonosov Porcelain Factory. From now on I will be drinkingmy coffee at work in style. A masterpiece like this could only bemade in St. Petersburg. This is how they live in Petersburg — hand in hand, supporting eachother in work and in life. I try to sum up the day while walking to the station. The ima-ge of three heroes from Russian folklore suddenly comes tomind. The number three is quite an important one here — threecompany heads, three approaches, three looks, and three cha-racters. It all makes sense. The number three is symbolic inour company. It’s a “dialogue for three.” As Andrei says, “If wecontinue listening to each other, together we can achievemore.” Standing on the platform, I take in one last breath of the city’s li-berating air. This same air courses in the blood of our Petersburgcolleagues, characters not unlike the city itself — firm and deter-mined, flexible and calm. Just like St. Petersburg, they will face anytribulations with grace and honor. See you soon, St. Petersburg!

“The finan-cial crisiswill lead tonew econo-mic possibi-lities forRussia. Weneed to fi-gure outwhat stepsto take tomake surethat peoplecome to usfor financialhelp. What aunique op-portunity —helping toreengineer abusiness!”


Troikers Key appointments

We are proud to introduce the finest professionals of the financial world who have recently join us

FOTO

BA

NK

/STO

CKFO

OD

(2)

; VO

STO

CK P

HO

TO (

1)

3 It seems that there is no official routemap for Moscow buses and trolley buses.4 Anything that is simply prepared,keeping the original flavors of the ingre-dients.

Philippe JordanManaging Director,DCM — Investment Banking

Providing Troika's corporate and insti-tutional clients with derivatives andstructured solutions

Responsible for equity/equity-linkedorigination and execution

Everything that isnot about invest-ments. (motto:“You spend,I save.”)

1 Troika has the dis-cerning long-termstrategies, perfectlysituated in once in alifetime opportunityin Russia.2 As long as the cli-mate is not verywarm, I am content.Usually this is home,now in Moscow.

3 At thepreview of the Da-mien Hirst auction,since I never sawa unicorn before.4 Anything thatrequires my da-ughter to peel thevegetables, myson to chop themup and which mywife enjoys.

5 “The Gener-al of the DeadArmy” by Is-mail Kadare.

1 Leadership, people, reputation, track-record, values... and Russia.

Kanako SekineManaging Director, COO,Troika Capital Partners

6 Lots of them — a round the world tripwith my wife and children, teaching con-

temporary history... and seeing Russia andEurope getting closer at last.

6 World peace (no kidding!) When I wassmall, however, I was fascinated by the ideaof becoming a professional revolutionary.

2 In a small village in the SouthWest of France on the AtlanticCoast where I go every year —a unique quality of life.

5 “The Possibili-ty of an Island”by Michel Ho-uellebeck and“When ThingsFall Apart” by abuddhist nunPema Chodron.6 To visit eachcountry in theworld and tomake one pa-inting in each.

Michael GibaultManaging Director,Head of Equity Capital Markets,IB

3 Moscow always, asthe city of extremes.4 A plate of cheese,fresh strawberries anda bottle of St Julien(1996.)

1 I predicted the global meltdown and Iknew that Troika would be the only sur-viving investment bank in the entire uni-verse.2 When I am in frontof my easel lookingat all thosebeautiful oilpaints on mypalette andwhen I do notknow whereto start. 5 “Le Charme Noir”

by Yann Queffelec— about France'swar in Algeria inthe early 50's andone of my pre-ferred books —“The Master andMargarita” byMikhail Bulgakov.


Nicholas HarwoodManaging Director,Deputy Head of Global Markets

Luis Vaz-PintoManaging Director, InvestmentBanking — Head of Syndicateand of Corporate Broking

Developing Troika’s GM business

1 The sincerity as a business principle.Good team.

2 In contemporary art galleries.

To originate and coordinate Invest-ment Banking business for Troika inKazakhstan and to build and roll out alocal securities trading platform

Developing Troika’s IB business. Syndi-cated IB deals and brokerage for Troi-ka’s corporate clients

1 Troika combinesleading local mar-ket expertise withfull cross-borderplatform. It has astrong and attrac-tive culture.2 At the dinnertable or in thegym.

1 To be part of the transformation ofRussia's Investment Banking market,one of the most interesting, exciting andvibrant markets.2 Surrounded by good friends.

5 I have temporari-ly suspended rea-ding a historical ac-count of The Rapeof Nan King to ab-sorb as much as Ican about what isunfolding in the fi-nancial markets. 6 To wake up oneday and to findthat stability hasreturned to theworld.

3 The US congress.

4 Shepherd's Pie, a typical Englishdish.

1 WhyTroika?

2 Where do youalways feelgood?

3 What were youmost recentlysurprised at?

4 What is yourfavorite dish?

5 What are youreading at themoment?

6 Have you got adream and whatis it?

Questions:

5 I love reading and tend to read severalbooks at the same time. I am currentlyreading Troika’s latest Research, “TheLast Tycoons”, a story of Lazard compa-ny and “Fooling Some of the People Allof the Time” about activist’s strugglewith Allied Capital.6 There are too many to put down!

3 The cost of livingin Moscow.

4 Sushi.

3 The efficiency ofMoscow’s gypsycabs.

5 My Russian lan-guage text books.

6 Never stopdreaming.

4 A braai, aSouth Africanbarbecue.

James TurnbullCEO IB&GM,Troika Dialog Kazakhstan


FOTO

BA

NK

/GET

TY IM

AG

ES (

2)

Troikers Key appointments

We are proud to introduce the finest professionals of the financial worldwho have recently join us

Viacheslav SemenikhinRegional Director for Moscow,Ukraine, Kazakhstan

Organizing Troi-ka’s retail prod-ucts sales. Guar-anteeing Troika’sleadership in allmarket segments

Position IT asstrategic asset,not as a liability.Aligntechnology withbusinessstrategiesbetter, fasterand cheaperthan theircompetitors

1 Troika is a uniquecombination of de-veloped thinkingwith startup spirit.

1 Troika’s ambi-tions, the compa-ny’s sterling busi-ness reputation,and its spectacularteam. 2 In good compa-ny.

5 Fairy tales atnight to my son....This is all that myearly-bird organ-ism is capable ofat night.

Vladislav RysinChief Information Officer,Managing Director

6 To find out how to be a professional barman, DJ, or cook. Iwould like to try this out, to be an expert in these professions.

Tatiana ScherbanTraining and DevelopmentDirector, HR

2 At home.

4 Homemadesandwich.5 John Grisham,“The Appeal”,Solzhenitsyn,stories.

6 To see mygreat-great-grandchildren hap-py in Moscow.

3 People’s ability tostay happy duringthe financial crisis.

3 I am in the “peo-ple” business.Happily, peoplestill surprise me.

Creating — together with a wonderfulteam — systems, mechanisms, andmethods for the appropriate, excitingprofessional development of our em-ployees

1 Because Troika isTroika. No othercompany is like it! Iwanted to become apart of this success-ful, one-of-a-kind in-ternal culture.2 If you are sur-rounded by smart,interesting, driven,and positive people –they are always niceto be with!

4 I am a fan of Italianfood. If you have pas-ta, parmesan, and agood wine, fresh chia-batta, and a softcheese, your day isbasically made.

3 The thing that I do not rememberwhen I was most recently surprised at. 4 Cooked with love.

6 I dream of all mydreams come true.

5 Re-read Umber-to Eco's Foucault'sPendulum.


Lubov EliseevaInternal CommunicationsManager

Alexei IschenkoHead of Global Sales,Managing Director

Managing Private Banking productsales in Russia, Ukraineand Kazakhstan

Developing Troika Dialog’s business in Kazakhstan

6 My dream is to be healthy and happy.That way, the people around me alsowon’t grieve as well.

1 Troika is one ofRussia’s bestbrands, with lotsof potential for de-velopment, an ex-cellent reputation,a focus on devel-oping Russia andthe CIS, a stableteam and appro-priately sized (am-bitious, but feasi-ble) projects.2 Surrounded byfriends and lovedones.

1 Troika’s values and philosophy are close to my own.2 I am always happy at home, surrounded by family.

I am responsiblefor making infor-mation within thecompany accessi-ble, contempo-rary, and under-standable

1 Because Troika isa unique fusion ofprofessionalism,creative energy,confidence,strength, and am-bitions to improvelife in this country.

2 By the sea.

5 Tom Peters forinspiration andBulgakov forpleasure.

3 The price that Mikhail Prokhorovpaid for Renaissance. 4 I love just about

everything, but Ital-ian cuisine is my fa-vorite.

5 PavelTeplukhin’s “Ma-trix,” of course.

Askar YelemesovChairman, Troika DialogKazakhstan Board of Directors 3 That in Tbilisi there is a spot where a car with a turned

off motor can travel uphill rather than downhill.

5 Peter Hop-kirk “Questfor Kim: InSearch ofKipling’sGreatGame”. 6 Independence.

6 A small dream —to live happily 100years, have threechildren and travelthe world with myfamily. A biggerdream is to live in aworld full of love.

3 Probably howquickly autumnset in — onceagain. 4 Oysters andChablis.

4 Traditional Kazakhfood — beshbarmak.

1 WhyTroika?

2 Where do youalways feelgood?

3 What were youmost recentlysurprised at?

4 What is yourfavorite dish?

5 What are youreading at themoment?

6 Have you got adream and whatis it?

Questions:


Leisure Books

The Troiker recom-mends the most absor-bing new releases inthe world of literature

RPG

/CO

RB

IS(1

); E

AST

NEW

S/G

AM

MA

PR

ESS

(1)

And in all the-se worlds loveis a universalpower, theonly thing tolive for and aforce againstdeath. Butthere comes atime whendeath is allyou havewhereas loveand music areblown awayby the cosmicwind. A newmyth, a storyof Orpheus,Eurydice, anda photograp-her who fallsin love withEurydice andbecomes thenarrator of thewhole story

Neale Donald Walsh, Conversations with God: an Uncommon Dialogue. The readerwill either experience repulsion or a feeling of enlightenment and understandingof universal harmony and order.

Vladimir Chulikhin Legal Department

One could say the ironical misant-hrope Tonino Benacquista has writ-ten something similar to the second

Godfather, only instead of Nino Rota’s in-famous soundtrack the reader hears “MaryHad a Little Lamb.” Tonino Benacquista con-tinues the story line of the Blake family. Inthe first book, these New York mafiamembers are sent to France by the FBI aspart of the witness protection scheme,where they try to adapt to middle class life.In the second book, they engage in so-mething similar: they once again changetheir family names and place of residenceand are once again in search of themsel-ves. This family — though with ordinary,commonplace problems (children grow upand fall in love, the mother tries to start herown business, the head of the family be-comes a rather famous writer) — still doesit all in a mafioso sort of way.

Tonino BenacquistaMalavita–2 Amphora

Yuri Arabov’s prose, poetry and scre-enplays are somewhere between theearthly and the ethereal: if it’s not

exactly a miracle — it’s the groundwork forone. Before the novel was even published,Alexander Proshkin, a film director, had deci-ded to make a film version of this story, whichis about how people can’t see God, even ifthey are looking straight at Him. When Ara-bov was still a child, he heard a story aboutan ordinary Soviet girl who out of mischief be-gan dancing with an icon of Saint Nicholas theWonderworker — and was punished for herblasphemy, frozen on the spot and turned intoa pillar of salt, like Lot’s wife. She stayed thisway for 128 days with people bustling aroundher — party workers, journalists, neighbors —all trying to understand whether this wassome kind of divine intervention or illness. Thetitle of the book speaks for itself. Doubt it?Then you’re not ready for a miracle.

Yuri ArabovThe MiracleAST

Abeautiful — sad, funny, desperate— plea… No, a demand. No, a cryfor help. A certain Benjamin Ford is

stuck at the airport and writes an officialletter to American Airlines asking for a re-fund for his canceled flight. He managesto write only two bureaucratic lines beforehis letter turns into a confession. Ford wri-tes about his alcoholism, his unfortunatemarriages, his father the Holocaust sur-vivor, his work translating a Polish novel,his early poems, about how thanks toAmerican Airlines, he will be late for hisdaughter’s wedding and will miss a chan-ce to tell her all that he wanted to say. Lifeis almost gone, the flight is canceled, allthat is left is to sit and write: “DearAmerican Airlines…”

Jonathan MilesDear American AirlinesPhantom Press

Salman Rushdie The Ground Beneath Her FeetAmphora

Salman Rushdie’s books can’t be retold — one can only live them. His every novel islike a noisy marketplace somewhere in Bombay, a pungent mixture of spices. Thenovel The Ground Beneath Her Feet was written almost ten years ago and beca-

me one of the best novels about music — more precisely, about rock music. U2 have evenrecorded a single using the words of the novel’s character, Ormus Cama, a rock musici-an, who is part Lennon, part Presley, a bit of Freddie Mercury, and touch of Dylan. Thatis, Orpheus is a singer representing all the musicians of this world — former and future.And not only of this world: the novel features an endless variety of worlds and it is notthat clear which world belongs to us and which belongs to the characters. And in all the-se worlds love is a universal power, the only thing to live for and a force against death.But there comes a time when death is all you have whereas love and music are blownaway by the cosmic wind. A new myth, a story of Orpheus, Eurydice, and a photograp-her who falls in love with Eurydice and becomes the narrator of the whole story. Rock’n’rollis dead and rock’n’roll is alive: between these two notions all the characters of the no-vel struggle to stay afloat — like the frogs from a well-known fable — in the unfathomablemilk of real music. They try to take a breath and sink to the bottom.


Films LeisureThe Troiker gives its

approval to fall relea-ses in “the most im-portant of the arts”

It is a blackand whiteimage of“private life,disjointedthoughts, andfears”, whichbecomes theportrait of anepoch. What’smore, it isunclear if it isthe epoch ofthe sixties orthe timelessepoch of theRussian intel-ligentsia, itstimeless“today”

Solitude in the net. I would name this film “A Man and a Woman of the 21st Century”.Even the lovers of classics and the golden age of Hollywood will be pleasantly surpri-sed by this deep and meaningful film.

Victoria Abramenko PR Department

Changeling is a powerful, well-calcu-lated film about a mother who losther son. It is based on a true story.

In 1928, a woman lost her child. The poli-ce, instead of starting an investigation, bro-ught her a different boy. When she reactsto this by complaining and protesting,they coop her up in a nuthouse. Over timeit is revealed that the child may have fal-len victim to a maniac. Hysterical, deepcharacters are a good fit for Angelina Jo-lie — just like the beautiful hats and over-coats of the late twenties. As for Eastwo-od — he has already become not only aclassic, but an ultimate professional, ableto make the audience cry and think of im-portant things. Changeling is neither a de-tective story about the child nor a dramaabout the grieving mother — it is a socialthriller, arguing that one person’s voice isenough to change the world.

This is a slightly eccentric essay onthe topic of “How I spent my sum-mer, how my summer spent me.”

Two New York ladies, a blonde with apenchant for bohemian lifestyles ( Jo-hansson) and a brunette (Hall) engagedto a bore, are going to Barcelona for asummer holiday. There they meet ahandsome artist. A lot of romance, sex,grievances and nightmares follow, alongwith the return of the heartthrob artist’seccentric, bisexual wife (Cruz), but thewhole story boils down to the messagethat everyone needs a holiday someti-mes. Javier Bardem, the terrifying mur-derer from No Country for Old Men, inWoody Allen’s film becomes a great se-ducer, the very essence of Barcelona:every woman gets what she wants, buthe lacks the strength to fully satisfyeveryone.

Paper Soldier, this year’s big winner inRussian cinema, received the SilverLion for Best Director and the Osella

award for best cinematography at the VeniceInternational Film Festival. This film is abo-ut a doctor who prepared Soviet cosmona-uts for their first flight in 1961 and is entire-ly a product of the Soviet “cinema thaw”: itis a black and white image of “private life,disjointed thoughts, and fears”, which be-comes the portrait of an epoch. What’s more,it is unclear if it is the epoch of the sixties orthe timeless epoch of the Russian intelli-gentsia, its timeless “today”. The constantsmell of burned flesh haunting the film’s pro-tagonist, his dream filmed in Tarkovsky’s sty-le, his entanglement between two almostidentical women, a great deal of quotes fromChekhov — in sum, this is a sublime dramaabout those who strive for the best but diewhen they finally reach their goal.

ChangelingDirector: Clint EastwoodStarring: Angelina Jolie,John Malkovich

Vicky Cristina BarcelonaDirector: Woody AllenStarring: Scarlett Johansson, Javier Bardem, Re-becca Hall, Penelope Cruz

Bumazhny Soldat (Paper Soldier)Director: Aleksey German Jr.Starring: Merab Ninidze, Chulpan Khamatova,Anastasia Sheveleva

Quantum of SolaceDirector: Marc ForsterStarring: Daniel Craig, Mathieu Amalric, Olga Kurylenko, Judy Dench

Films with Daniel Craig have acquired the title “new Bond,” because never beforehas there been such a Bond. It’s like opening a children’s coloring book and seeinga very serious man staring at you from a passport photo. He is elegant, but his ele-

gance is that of a metal safe dressed in an evening suit. He looks good with women byhis side, but these women turn out to be deadly themselves. Thus, we have an actionfilm on environmental protection instead of a children’s fairy tale. Marc Forster, direc-tor of Quantum of Solace, author of the harsh drama Monster’s Ball, is sure that the onlyway to develop the Bond films is within Bond himself. For twenty films straight, it se-emed that there was nothing inside Agent 007 except his watch, lighters, bow tie, spe-ar cartridges and the phrase “Bond. James Bond”. Now, however, a real person is evi-dent behind the image and this person is enraged. Quantum of Solace is a direct sequelto Casino Royale: having lost his love, Bond is going to take revenge — the film is all abo-ut a wild, savage drive, which is thrown at the audience with such intensity that, com-pared to Quantum of Solace, even Casino Royale starts to feel like an “old Bond” flick.


Leisure Art

The most prominentevents in the world ofthe arts. Exhibitionsyou don’t want to miss

He painted oneverything —walls, canvas,paper,furniture.They wouldsay thatBasquiat had a“painter’sfever”: threesquare metersof painting aday and more.Here’s thebiggest surpri-se: the longline of buyersfor Basquiat’sworks inclu-des bothknowledgeab-le collectorsand museumsalike

The Epoch of Grace Kelly. This exhibition once again points out the unique dramaticcharacter of this amazing actress, the refined style of this exceptional woman, thePrincess of Monaco.

Nazim KadimiPersonal Investments Department

The Riga-born dancer, choreographerand director, principal of the MariinskyTheatre Mikhail Baryshnikov today is

an American actor who also turns out to bea photographer. However, Baryshnikov is adancer who is true to his calling. Whether itis a Broadway musical, the Sex and the CityTV series, or photography, it’s all about thesame thing — dance. However, for a sixty-year-old choreographer with a tumultuousdancing career behind him, there comes atime to transcend his ego and think aboutsomething timeless. For example — pho-tography. Baryshnikov takes pictures ofthe great choreographer Merce Cunning-ham’s Dance Company. Baryshnikov watc-hed the master closely for several years, try-ing to make a detailed photo account of hiswork. These photographs show the realityof dance — something an ordinary specta-tor in the auditorium will never see.

Mikhail Baryshnikov18 November 2008 – 31 January 2009, Pobeda Gal-lery (Winzavod Moscow Contemporary Art Center)

Oscar Rabin is many things: founder ofthe “Lianozovo Group,” organizer ofthe “Bulldozer Exhibition,” son-in-law

of the painter Kropivnitsky, a vagabond, anda dissident. In 1978 he was deported from theSoviet Union. They called him lucky at home.The French spotted his rare personality andhis artistic genius. They gave him a new fo-reign passport and offered a workshop ac-ross from the Pompidou Center. Neverthe-less, Rabin couldn’t help thinking of Moscow.Living in Paris, he keeps painting the Russi-an capital with its low-rise lopsided housesin the center and new identical modular buil-dings on the outskirts. Rabin is now 80 yearsold, his Russian passport was returned withbows and honors, and now he is even hol-ding his first exhibition in Russia, his nativecountry. What’s more, the legendary Tre-tyakov Gallery was chosen to host the artist’sfirst official Russian retrospective.

Oscar Rabin30 October – 7 December,the State Tretyakov Gallery on Krymsky Val

The Turner exhibition, here from Lon-don, is rumored to be the most ex-pensive exhibition in the history of the

Pushkin State Museum of Fine Arts. Ho-wever, it seems wrong to speak of moneyand the legendary Turner at the same time.William Turner (1775–1851) is a master of ro-mantic landscape painting and the fore-runner of the French Impressionists. ARoyal Academy of Arts graduate, he co-uldn’t dare imagine that his expressive ra-ging waves, sunsets merging with thescenery and powerful torrents of wind wo-uld remain iconic for 150 years, giving birthto new meanings and genres. The painterleft nearly his entire heritage to England andnowadays his works are seldom seenoutside the country. Therefore, it’s a safebet that the Turner exhibition at the Push-kin State Museum is a stroke of luck on parwith the Mona Lisa display in 1974.

William Turner18 November 2008 – 15 February 2009,Pushkin State Museum of Fine Arts

Jean-Michel BasquiatOpen from mid-December at the Baibakov Art Projects Gallery (on the territory of the KrasnyOktyabr factory)

The exhibition spaces on the former shop floors of the Krasny Oktyabr factory areamong the best in the city. Situated in the heart of Moscow, with large halls offe-ring a view of the Moscow River — what else could you ask for? This space is now

home to the permanent gallery called Baibakov Art Projects; the head of the gallery isMaria Baibakova. The new facility’s first exhibition features the African-American artistJean-Michel Basquiat (1960–1988), who, despite his early death, remains one of the topten most valued young painters. At the young age of 8, Jean-Michel was busy paintingprimitive, scary images on the walls of his native Brooklyn. At the age of 19, this stre-et rioter became a rare find for art dealers and gallery owners and one of the key play-ers in pop art, all the rage at the time. Death, shamans, African tribal chiefs — these arethe painter’s main subjects. He painted on everything — walls, canvas, paper, furniture.They would say that Basquiat had a “painter’s fever”: three square meters of paintinga day and more. Here’s the biggest surprise: the long line of buyers for Basquiat’s worksincludes both knowledgeable collectors and museums alike. Dark yet full of expression,seemingly coarse but incredibly thorough, American yet also voodoo, this graphic workis something that suits everyone’s taste. Maria Baibakova is hardly an exception.


Some of the mostanticipated theatre

premieres in Moscowthis autumn

ITA

R-TA

SS(1

)

The loversmust enduretorture anddeceit beforefinally me-eting theirloved ones.However, the-re is no tradi-tional happyending — thelovers’ joyfades with thenews of thedeath of theking of France.

Zayats. LOVE STORY. This play’s main characters experience nothing but melanc-holy and excruciating loneliness. However, the spectator is in for a real treat —Nina Doroshina and Valentin Gaft are first-rate actors.

Olga PogosianAsset Management

Asingle woman lives in a provincialtown. She works at the hairdresser’sshop; she has her admirers — a fire-

man who brings her gifts of home appli-ances rescued from fires and an elderly ci-vil servant. But she doesn’t need anyone —she has a pen friend in prison who promi-ses to marry her in the near future. The vil-lain convinces the hairdresser to sell her flatin order to move to Moscow. But instead ofgoing to the capital he takes her to the fi-elds and tries to kill her. She miraculouslysurvives, the murderer returns to prison andin the final part the hairdresser is once aga-in looking excited reading a new letter fromher lover in which he pleads with her to be-lieve him as before. The leading part is play-ed by Inga Oboldina — an actress who fe-els perfectly comfortable in the ocean of thenaïve woman’s consciousness.

Rimas Tuminas is one of those Lithua-nians worshipped in the theatre worldand most beloved in Russia. Tuminas

has a perfect sense of humour, which hel-ped him charm Moscow’s theatres — theSovremennik Theatre is still staging his Ig-rayem… Shillera! (We Play… Schiller!) star-ring Elena Yakovleva and Marina Neyolo-va. Tuminas and Vakhtangov Theatre havea long-term friendship, which is now sea-led by a contract — in the previous season,he became the theatre’s new art director.His first production, Troilus and Cressida, aplay by William Shakespeare, is set in thetimes of Troy when Paris stole fair Helen.It is an impressive production with complexscenography, filled with references to themodern militarized world. It should bementioned that Helen’s part is played by thebrilliant comic actress Maria Aronova.

Plays staged by Sergey Zhenovach arealways meaningful and have a ho-melike, cozy feel to them. Nowadays,

his studio has its own stylish facility — whatappears to be Moscow’s best theater buil-ding has been built on one of the Tagankaside streets. The second local premiere —following The Battle of Life based on Dic-kens — turned out to be Platonov’s The Po-tudan River, featuring four of the studio’sactors, including Maria Shashlova and And-rei Shibarshin. One could say that AndreiPlatonov’s tender and austere story abo-ut humble people, their modest lives, andlove on the banks of the Potudan River istotally irrelevant to contemporary life. Ho-wever, the writer’s modest idealism, hu-mane simplicity and tragic depth create anideal measuring stick for modern life.

Parikmakhersha(The Hairdresser)By Sergey Medvedev. Directed by Ruslan Mali-kov, Praktika Theatre

Troilus and CressidaBy William Shakespeare. Directed by Rimas Tu-minas, Vakhtangov Theatre

Reka Potudan (The Potudan River)Based on Andrei Platonov’s short story. Directed by Sergey Zhenovach,the Studio of Theatrical Art

Love's Labor’s LostDirected by Lev Dodin. Maly Drama Theatre (MDT) — Theatre de l’Europe (St Petersburg).Part of the “Golden Mask” project

The Shakespearean romantic comedy, staged by Dodin straight after the solemn pro-duction of Grossman’s Life and Fate is being shown in Moscow for the first time andis unlikely to remain unnoticed among the “blockbuster shows” of St Petersburg the-

atre. Dodin as an artist has an acute sense of the zeitgeist. Therefore, in Love's Labo-ur’s Lost the tragic feeling of fate is also present, though mainly it is about the intrica-te winding plot and sensuality, easily managed by Dodin’s troupe, including recently gra-duated actors: Elizaveta Boyarskaya, Elena Solomonova, and Alena Starostina. Accordingto the plot, the king of Navarre and his three friends decide to spend several years indedicated study, but break the oath and unbeknownst to one another fall in love withthe princess of France and three of her ladies-in-waiting respectively. Apparently, thelovers must endure torture and deceit before finally meeting their loved ones. Howe-ver, there is no traditional happy ending — the lovers’ joy fades with the news of thedeath of the king of France. So, instead of love comes parting, which seems to be a sha-dow of death. The set design was created by Alexander Borovsky — in is his first pro-ject with Dodin.

Theatre Leisure

Tom PetersRe-Imagine!BestBusinessBooks

Tom Peters, the worldwide bestselling author, master of newapproaches to doing business, and management guru, hasreturned with an outstanding new book about how things

work in the contemporary business world. Written with inimitablestyle and presented in a layout which gives maximum clarity tothe author’s new philosophy, Re-Imagine! inspires us to action.Learn all about the destructive commands of Tom Peters, see howhe predicts the death of bureaucracy, and find out exactly whyhe thinks business is cool. “We are encouraged to think beauti-fully. To think strangely and make sense of far more ‘changes’ thanwe could have imagined before.” Tom Peters has once again cre-ated an entirely new approach to business. He argues that “tak-ing a fresh look at business is the primary task and responsibili-ty of our generation.” Insightful, provoking, inspiring, and truly pro-gressive, Tom Peters’ new business-bible, filled to the brim withreinterpretations, will help everyone take a fresh look at theworld — in all its forms.


The Troiker RecommendsBooks to help every Troikerat work

PHO

TO B

Y: L

UB

OV

SH

EMET

OV

A

Reading lessonsWith the era of difficult changes upon us, the best thing to do isask the smartest people for advice. The Troiker recommends twobooks that can help us survive the crisis.

“The last 35 years of my career has been a redexclamation point.

Please don’t steal my logo.But rob it of its spirit asmuch as you can.The spirit of WOW!”

“The fear of changeis nothing incomparison to asense of personalworthlessness”

“Play!Inventnew things!Quickly!”


“If you do business with eccentrics, you’llbecome an eccentric.

If you associatewith bores — you’llbecome a bore”

Alan GreenspanThe Age of Turbulence: Adventuresin a New WorldAlpina Business Books

Alan Greenspan spent 18 years as Chairman of the U.S. Fed-eral Reserve — the second longest term in history. It wasMr. Greenspan who steered the world’s largest financial

system through the upheavals of the 1987 stock market crashand the burst of the dot-com bubble at the end of the 1990s.Mr. Greenspan throughout this time ardently defended the ad-vantages of free markets, as well as his faith in the market’sability to solve its own problems. In 2007, all of two years intoretirement, Mr. Greenspan published “The Age of Turbu-lence.” According to the author, most of the book was writtenin the comforts of a warm bath. Mr. Greenspan’s book bears noresemblance to the typical memoir of a retired government of-ficial. This “memoir” is actually a combination of global economicanalysis, a major attempt on the author’s part to defend his ownviews, and a critical review of the current American adminis-tration, which, as the author argues, has become carried awaywith budget expenditures and has put the economy at the serv-ice of politics. In the first half of his book, Mr. Greenspan nar-rates the history of his own personal views. In the second half,the author covers the basics of the new economic situation: theprinciples of management, energy infrastructure, global financialdisparities, and core changes within world demography. Afterthis, Mr. Greenspan attempts to portray the global economy in2030. Here’s where things become interesting. First of all, let’sthank the SKOLKOVO Moscow School of Management for spon-soring the Russian edition of the book and making it availablejust one year after the original was published. However, the sit-uation has taken the most radical changes possible over thistime. As 2008 comes to a close, Mr. Greenspan’s views are notas popular as before — many economists attribute the presentcrisis to none other than Mr. Greenspan’s lack of trust towardoutside regulation of the financial markets. Whether this istrue — only time will tell, but the days of blissful hot baths forMr. Greenspan and his supporters are clearly behind us.

“I strongly adviseyou to get in thedreaming business.The business ofimprobablefantasies”


Education SKOLKOVO

Troika announces a unique opportunity —Executive MBA program

Unlike a typical MBA, the EMBA program is intended for cur-rent top managers and business owners with a strong ma-nagement background. Such individuals can both learn from

SKOLKOVO’s professors invited from the world’s leading businessschools and offer useful instruction to their peers. It’s a group thatcannot just forget their jobs and attend classes full-time, even ifthey wanted to. The EMBA program was tailored with just thesepeople in mind, allowing them to keep their jobs, perfect their pro-fessional skills, and make new contacts. The program consists offifteen course modules ranging between four and six days in length— including weekends and holidays — as well as a one-week tripto China. One and a half years of this course load allows partici-pants to achieve everything listed above without interrupting the-ir careers.The SKOLKOVO EMBA program primarily concentrates on buildingleadership qualities. At the start of the “Practice in Leadership” co-urse, each participant is introduced to their personal adviser. Thro-ughout the entire program, the adviser will act as the student’scounselor, market expert, and professional consultant. What’s more,students can turn to their advisers for advice at any given time.The program also includes group sessions that are conducted byfirst-rate trainers from foreign and Russian leadership centers. The-se sessions will help students refine their negotiating skills, ma-nage conflicts, make decisions under uncertain conditions, and le-arn how to select a team. Additional courses — from macroeco-nomics to decision making theory — are put together by guest pro-fessors, experienced managers from Cambridge, Columbia, INSEAD,and the London School of Economics, to name just a few. Even if

the student has previous experience with these subjects, the SKOL-KOVO EMBA program will help them look at familiar spheres ofknowledge from totally new, unexpected points of view. As a mat-ter of fact, previous experience is welcome — it provides an in-valuable boost to the entire group. Finally, the EMBA program of-fers another important opportunity: as always at SKOLKOVO, stu-dents will have the chance to meet and communicate with theschool’s guests — state representatives, businessmen, scholars,athletes and artists. The SKOLKOVO EMBA program isn’t cheap bytoday’s standards — 90,000 euro. On the other hand, it’s worthit. In the words of Wilford Vankhonaker, Dean of the Moscow Scho-ol of Management, “With today’s uncertainty on the Russian andglobal markets, choosing our program — this is a strategic in-vestment that will definitely be returned, no matter what the outsi-de factors are.”

Time to Go Back to SchoolThe Moscow School of Management SKOLKOVO, founded in 2006 at Troika’s initiative,will launch in January, 2009 its first long term program — the 18-month Executive MBAcourse, a program without analogues in Russia.

“With today’suncertainty onthe Russianand globalmarkets,choosing ourprogram —this is a stra-tegic invest-ment that willdefinitely bereturned”

Afisha Industries PDF. Processed by PitStop...

Documents

Transcript of Afisha Industries PDF. Processed by PitStop...