MOSCOW--(BUSINESS WIRE)--Finstar Financial Group, private investment vehicle founded by Russian billionaire Oleg Boyko, today announced the sale to management of Pobeda State Lotteries LLC, an operator of a Russian state lottery under the same name.
The purchasers of the company are its current senior management team headed by the general director Oleg Butenko. Terms of the transaction were not disclosed but Mr. Boyko said payment would be in installments.
Starting in July 2014, Pobeda became one of three lotteries authorized to operate in the Russian Federation, along with Gosloto and Sportloto. In mid-2014, Pobeda incorporated two non-state, but very popular brands – the Golden Key and the Railways Lottery.
In June 2015 the state contract giving Pobeda the right to conduct 16 all-Russian state lotteries, will expire. It is not currently known whether the contract will be extended.
The Finstar announcement included assurances that the change of ownership will be seamless and have no impact on lottery participants. Pobeda’s liabilities under the state contract are insured by bank guarantee.
While not confirming Russian media reports that his exit from the lotteries was related to reputational risk, Mr. Boyko said the decision to divest had long been in the planning. He pointed out that Finstar sold the operating company behind the Sportloto, another state lottery, three years ago.
“The lotteries business has been very interesting for us, but it is not a core business for Finstar, which is a finance and investment company with stakes in a variety of other sectors,” Mr. Boyko said. “It is natural for us to find strategic opportunities to move in and out of some positions. That is what we do routinely.”
The Pobeda all-Russian state lotteries were founded in 2010 by a decree of the Russian government. The Federal Agency for Special Construction managed by the Ministry of Defense of Russia is the organizer of the lotteries.
According to the official website of the operator, “The project is aimed at organizing an additional source of financing the events within the framework of implementation of the Strategy of Social Development of the Armed Forces of the Russian Federation for the Period up to 2020. All proceeds from the Pobeda lotteries are spent for supporting the socially important projects and events in line with this strategy’s implementation.”
About Finstar Financial Group
Finstar Financial Group is one of the largest private investment groups in Russia with assets over $ 2 billion. It has been historically headquartered in Moscow and its portfolio assets are located in Russia, CIS countries, the Baltics, Europe, Asia, and other regions. Founded in 1996, Finstar has a significant experience in launching start-up projects and in restructuring and expanding companies in selected industries.
About Oleg Boyko
Cited by Forbes magazine as one of Russia’s ‘Most Respected Billionaires’, Oleg Boyko founded Finstar Financial Group as a diversified private equity firm with an estimated market value of assets under management exceeding $2 billion. Mr. Boyko is also Head of the Paralympic Movement Development Committee of the Russian Paralympic Committee and Founder of the PARASPORT Foundation. PARASPORT is a nonprofit charitable foundation organized to support the training and competition of athletes with disabilities, both in Russia and internationally.