Alfa-Bank - Alfa Group

Alexei ReznikovichChief Executive Officer of Altimo“In December 2005, we presented the new international investment company Altimo inLondon. We opened a new phase in our activities under a new name aiming to take theleading positions on the emerging telecommunications markets of Eurasia.Within one year Altimo's achievements are evident, and the Company has the right to beproud of them. Our experience of investing into the telecommunications markets of Russia,the CIS and Turkey gave us the opportunity to become one of the leading investors in theindustry; we increased the value of our investment portfolio in 2006 by workingsystematically and productively with the management of our companies. We intend tocontinue the promotion of the growth in value of our assets and continue our activity on theemerging markets of Asia and Eastern Europe.Also, within one year we became an integral part of the international telecommunicationsmarket and consolidated our status as a major and experienced investor. Altimo's team ofprofessional managers maintains a high international standard of corporate governance.”Telecommunications: trends and prospectsEurasian markets have an immense investment potential. Thetotal sales revenues of the three leading Russian operators grewby more than 35% in 2006, and the total number of subscribersincreased by 21%.The attractiveness of the developing markets of Eurasia isexplained by high economic growth rates, large populations,low mobile penetration and high GDP growth rates.The mobile communication coverage in many countries of theCIS and Eurasia is insufficient and the sector will develop at avery fast rate over the next few years. Altimo is ideally placed totake advantage of major development opportunities on thesemarkets.Altimo is one of the largestinternational investmentcompanies acting in the field ofmobile and fixed-linetelecommunications, holding aleading position on thetelecommunications markets ofEurasia. Mobile companies, in whichit invests, operate in Russia,Ukraine, Kazakhstan, Uzbekistan,Kirghizia, Tajikistan, Georgia,Armenia, Moldova, Azerbaijan andTurkey. The market capitalisationof Altimo's assets totals more thanUS $20 billion and the companies inits investment portfolio have over150 million mobile subscribers.Altimo is committed to the development of companies in itsinvestment portfolio. Altimo participates pro-actively in theBoards of Directors of the companies in which it invests, andalso provides consulting services to the management of thesecompanies. The Company’s goal is to fully realise the potentialof each company and maximise its value.Altimo is a financial investor which doesn’t seek to obtain controlover the companies in which it invests. The Company isinterested in exercising its position as a strong minority shareholderthe result of such form of balanced corporate managementallowing the company’s management to steer the companyindependently in the interests of all its shareholders.Altimo’s aim is to expand its presence on the developing marketsof Eurasia with the most attractive markets being thoseAltimo’s Strategycountries with large populations, low current levels of mobilecommunications penetration, high GDPs and low market competition.The chosen priorities are the countries of South,Central and Southeast Asia.Having set its sights on Eurasia and considering the fact thatthe international mobile communications industry is nowundergoing global consolidation, Altimo intends to take part inthat process by partnering with a leading European GSM operator.Creating a major alliance in mobile communications willgive Altimo an opportunity to use in full the best practices experienceof the European partner combined with Altimo’s practicalexperience investing in the developing markets.www.altimo.orgALFA GROUP / ANNUAL REPORT 2006 / 67