Disposal of a Production Project in Russia

DOI

10.2991/aebmr.k.201215.045How to use a DOI?

Keywords

business, business project, conclusion of transactions, direct investment, investors, entrepreneur, market economy, strategies

Abstract

Starting and running a business in Russia is significantly different from the same process Europe or the United States: it is much more difficult to dispose of a business than to start it, especially for unquoted companies. The inconvenience of liquidating direct investments is a serious barrier for foreign investors who are interested in the production sector of the Russian economy. In this article I would like to highlight the main challenges for the company’s owners while disposing of a project and to share my practical experience of solving them in a production company in Russia. Firstly, I consider spotting the optimal time for such disposal depending on the company’s strategy. Secondly, I show how to develop the plan for complete or partial exit from the project and to find a buyer. Then, I analyze the methods of calculating the fair price of a business project in Russia and the ways of convincing the buyer. I also describe the local specifics of the due diligence of the project for sale and the methods of maintaining confidentiality when preparing the transaction. Finally, I consider various ways of finalizing the deal from the legal and tax points of view. This article gives an entrepreneur the instruments to develop the exit strategy from a project in order to secure his direct investments in Russia.

Copyright

© 2020, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Petr Chumakov
PY  - 2020
DA  - 2020/12/17
TI  - Disposal of a Production Project in Russia
BT  - Proceedings of the 8th International Conference on Contemporary Problems in the Development of Economic, Financial and Credit Systems (DEFCS 2020)
PB  - Atlantis Press
SP  - 215
EP  - 220
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.201215.045
DO  - 10.2991/aebmr.k.201215.045
ID  - Chumakov2020
ER  -