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Co-owners of the Channel One will set up business with a Pridnestrovian oligarch

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The National Media Group, co-owner of the largest Russian TV channels, will deal with distributing TV content. The NMH will do it assisted by the company of Victor Gushan, the largest businessmen of the breakaway Pridnestrovian Moldavian Republic.

Partners from Transnistria

Within the National Media Group (NMG), incorporating the media assets of the bank Russia, SOGAZ, Surgutneftegaz and Alexei Mordashov, there appeared a new company: on August 5, it was registered LLC Natsionalnaya Set (National Network) with an authorized capital of RUR 100 thousand. The head office of CJSC National Media Group owns 25% in this LLC, another 25% belong to Oleg Borisovich Budak, Andrei Aleksandrovich Rejh and Vyacheslav Petrovich Chernikevich. The main activity of the National Network is declared as movie releases.

A source close to the NMG knows that the business of the National Network will be associated with Kartina.TV, the service registered in Germany, allowing the Russian-speaking residents from far abroad to watch Russian television. According to the extract from the German registry, Andrei Rejh owns 50% of the Kartina.TV’s management company the Kartina Digital GmbH, another 25% belong to businessmen from Transnistria Victor Gushan and Ilya Kazmaly each who are co-owners of the Sheriff Holding (Rejh himself confirmed the shareholding structure to RBC).

The company Kartina.TV will really have a joint project with the NMH, but we withhold comments before the official press-release, as Rejh states to RBC.

Oksana Razumova, the spokeswoman at the NMH, refused to comment the questions concerning the National Network.

The Sheriff is the largest trade and industrial holding company in the breakaway Pridnestrovian Moldavian Republic (PMR). The Holding develops its own retail network, trades oil products and operates some gasoline stations and sells cars, its holders owns Interdnestrcom, the only mobile operator in the PMR, and one of the largest banks Agroprombank. As stated on the web site of the Sherif Group, in 2012 the incorporated companies formed over a third (37%) of the Pridnestrovian economy and ensured 32% of tax revenues to the PMR’s budget. The Holding employs over 13 thousand people or 17% of all the employed people in the economy of the breakaway republic.

The Sheriff’s co-owners are the former policemen Victor Gushan and Ilya Kazmaly, who founded the Holding Company in 1993. The Sheriff has always been referred close to Igor Smirnov, the first President of Transnistria, who led the breakaway republic in 1993-2011. As written in the magazine Kommersant-Vlast, the Sheriff’s business success was due to unprecedented customs privileges (the Transnistria’s customs office was chaired during Igor Smirnov’s presidency by his eldest son Vadim). Yevgeny Shevchuk, the incumbent president of PMR, also worked at the Sheriff’s structures.

Another founder of the National Network Vyacheslav Petrovich Chernikevich, according to the SPARK database, is the sole holder of the Crimean operator Intertelecom. Now, as stated in the register of Roskomnadzor, the company has eight licenses for providing telecommunications services in the Crimea and Sevastopol. Before the peninsula’s annexation to Russia, a Ukrainian telecommunications operator with the same name was present there, and its owner was referred Victor Gushan, as reported by the newspaper Kommersant in October 2014. Previously, according to the Ukrainian edition Capital, Chernikevich was the commercial director of Interdnestrcom, the only mobile operator in Transnistria, the owners of which were also considered Gushan and Kazmaly (on the Sheriff’s web site this operator is listed as a partner of the Holding).

The fourth co-owner of the National Network Oleg Budak is also tied to the Sheriff. The Pridnestrovian Holding’s web site names the local sturgeon complex Aquatir as another partner, engaged in manufacturing natural black caviar. Oleg Petrovich Budak was the CEO at Aquatir in 2011, according to the records of the Chamber of Commerce and Industry of the Pridnestrovian Moldavian Republic.

Dmitry Ogirchuk, the CEO at the Sheriff, told RBC that he knew about the joint business of Budak, Chernikevich and Rejh with the Russian NMH, but did not specify any details.

Kartina. TV

Kartina.TV provides its users with access to the broadcasts of the Russian TV channels, both via TV-sets (in this case it’s required to buy a special set-top box) and via the Internet. The subscription fee for receiving over 120 TV channels (not only Russian but also Ukrainian, Baltic, etc.) is EUR 190 per year without installments. The exact number of subscribers is not specified on the web site, and the presentation only states that 60% of subscribers live in Germany, 25% in America, 5% in the UK, and the remaining 10% in other countries.

Apart from the German company, the business of Kartina.TV is formalized in favour of the Kartina World LLP, registered in the UK. The British register names its founders Yana Sevcenco and Oleg Sevcenco (likely Yana and Oleg Shevchenko). Neither the German, nor the British public sources disclose the companies’ revenues and profits.

Since September, the Kartina.TV plans to place third-party ads in the programs of the Russian broadcasters, although it does not even have any rights to distribute many Russian TV channels, as reported by the newspaper Vedomosti a week ago. At the Russian-speaking forum Pristavka.de, in the Kartina.TV’s thread, one can find the reprinted letters of the service management to its dealers asking them not to respond the threats allegedly coming from the Channel One. Perhaps you have recently received a letter of complaint from the JSC Channel One, containing threats against you as distributor of the Kartina.TV service, the letter says. Please note that the JSC Channel One has nothing to do with the content and mailing of this letter.

On August 23, however, the web site of the Channel One Worldwide Network, the subsidiary of the Channel One (engaged in distributing international version of the Channel One and also managing its Digital TV Family, i.e. the thematic channels Dom Kino (Cinema House), Muzika Pervogo (Music of the Channel One), Telecafe (TV cafe) etc.) released an official statement. The Channel One, 25% of which belongs to the NMH, states it has no contractual relationship with the Kartina.TV and did not confer any distribution rights to the company.

Now our lawyers are studying the situation, as declared by Anna Zaitseva, the representative of the Channel One Worldwide Network. All the content distributed by the Kartina.TV is legal, as Rejh insists.

The National Media Group as it is

Assets

The National Media Group, according to its website, was established in 2008 through the merger of assets of the bank Russia, SOGAZ, Surgutneftegaz and Alexei Mordashov, the Chairman of the Board of Directors of Severstal. The Media Holding owns 72.4% of the Channel Five, 68% of REN TV, 73.2% of the newspaper Izvestia, near 100% of the free newspaper Metro distributed in St. Petersburg, 100% of the radio station Russian News Service, 50% of the producer studio Art Pictures Vision (produces, in particular, the serial Molodezhka (Youth Ice-hockey Team) to the channel CTC).

In addition, the NMH owns 25% of the Channel One and is a minority shareholder of the Cyprus Telcrest, which owns 25.4% of the Holding CTC Media. In this August, LLC NMG Inform, one of the 100-percent NMH’s offshoots, was renamed as the Art Pictures Group.

Financial results

The Chairman of the Board of Directors of the NMH is Alina Kabaeva (she is considered to be Vladimir Putin’s civil wife), the President is Kirill Kovalchuk, a nephew of Yury Kovalchuk, the majority shareholder of the bank Russia.

The NMG revealed its statements last in 2013. Then, the Holding’s IFRS revenue exceeded RUR 14.7 billion, the operating profit amounted to RUR 2.4 billion, and the net profit was RUR 1.5 billion.

In June, the Etat Control International Company estimated for RBC the last year’s potential income of the NMH’s two main assets like REN TV and the Channel Five in terms of placing just federal TV advertising (i.e., excluding the regional spots). They might amount to RUR 5.3 billion and RUR 4.6 billion respectively.

Back to Distributors

The NMH probably wants to deal with content distribution in Russia, applying the technological know-how of the Kartina.TV, as the Group’s former top manager thinks. The Gazprom-Media owns the satellite operator NTV Plus, so the NMG will also own a technical service provider, as the RBC’s interviewer reckons, pointing out that the Group will not surely tolerate the use of illegal content. The National Network will operate in Russia as a content distributor, as confirmed by the source familiar with the NMG’s plans.

The NMH was already engaged in distributing content. In 2008, the Group together with its shareholders Surgutneftegaz and Alexei Mordashov acquired from Suleiman Kerimov’s structures the National Telecommunications Company, managing Mostelecom and TKT, the largest cable operators in Moscow and St. Petersburg. The evaluation of the company, as reported by the newspaper Kommersant, exceeded USD 1 billion. But then in 2011, being disappointed in that business, the NMG, Surgutneftegaz and Mordashov sold their 72% of the National Telecommunications for USD 951 million to the state-owned company Rostelecom.