Driving through the rain towards brighter economic future of Ukraine

About a month ago, during a Washington round-table on Ukraine hosted by the US-Ukraine Business Council (USUBC), someone asked me what do my colleagues and I expect from the new President of Ukraine and his administration? My answer, which was picked up by the Voice  of America and other publications, was essentially – I have no idea. But since we have been and continue to be bullish on the Ukraine for almost twenty five years, our strategy is to move forward despite the political climates, as we always hope for sunny investment weather, but carry a sturdy umbrella in case it starts to rain. 

Well, it is raining now.  Raining hard and much sooner than expected.

The events of this passed week have created a vicious firestorm with  “Ukraine” being mentioned practically non-stop.  In this post I will not address the politics of the situation, as this has been done by practically every major media outlet in the world ad nauseam. My focus will be on business opportunities and financing tools available to those wishing to invest into the Ukrainian economy, as despite this week’s “torrential downpour” nothing has fundamentally changed to make Ukraine a less attractive place to invest.

First, some basic assumptions under which we have been operating in Ukraine for almost quarter of the century:

• Massive institutionalized corruption exists in Ukraine and it will probably take two-three generations for it to be rooted out;
• Ukraine is a very risky place to do business;
• Many people who accumulated capital in the ’90’s played by the “fast and loose rules” and cut multiple corners;
• As business in the country evolves, most astute business people understand that by playing by the transparent and well-defined rules set out by the western markets they can unlock the value of their holdings, obtain access to low-cost financing and protect their assets for the generational asset transfer;
• Ukraine has fantastic potential for economic growth in multiple sectors;
• Terrific opportunities exist for US, Canadian and European companies to supply goods and services to Ukraine and to bring world-class Ukrainian goods into the Western markets;
• Ukraine has a superb pool of smart and educated labor force;
• Country is of a strategic geopolitical importance and will always be a subject of political pressure and outside influence;

Given the above, it is important to take a long view and not be terribly concerned with current politics, because by definition Presidents, Ministers, Ambassadors and Senators change every few years. Once such long-term philosophy is accepted, then it is necessary to construct one’s proverbial umbrella. Namely, risk mitigation, corruption resistant mechanisms must be incorporated into one’s approach to doing business in the country.  What this means in practice is the following:

• Targeting for investment and financing primarily those sectors where corruption is either low or  non-existent. From our standpoint exports of Ukrainian natural foodstuffs, renewable energy, electro-transport production, IT, nuclear waste containment are some of those.
• Utilizing US Government financing tools, such as those offered by OPIC and US-EXIM  Having these tools part of a business transaction not only provides low-cost, long-term financing, which improves economics of practically any project, but having government-backed financing in a deal, also improves quality of due diligence and acts as fantastic corruption deterrent and protection for investors.
• Obtaining political risk, trade credit, or breach of contract insurance for every significant deal or trade transaction. US  Government and certain well-rated global  insurance companies offer protection to investors from such perils as expropriation, creeping expropriation, currency  inconvertibility, non-payment for goods supplied, or services rendered and for breach of contract.  Such insurance is not terribly expensive, but  de rigueur for anyone looking to invest into the Ukraine, or into any  foreign market, for that matter.
• Creation of a so-called Grey2White® program to allow investment where original capital, or business formation had murky roots, but can be fully re-mediated with application of strict compliance procedures, financial restructuring and accounting oversight.
• Finally, despite of the current rainy weather, we are moving hard to add one more extremely effective tool, which has been missing in Ukraine’s economic development. Creating a safe umbrella for individual American-Ukrainian, Canadian-Ukrainian and members of Ukrainian diasporas in other countries to invest into the future of Ukraine.

What this means is a focused investment platform listed on a stock exchange and subject to a recognized US, or Canadian authority such as Securities Exchange Commission (USA), or Canadian Securities Administration (CSA). Such platform would will further be secured by protection of the political risk insurance and will, for the first time since Ukraine’s independence, allow individual investors with as little as $500! to invest,  to participate in Ukraine’s economic development, while having the umbrella of protection of the western laws, rules and regulations.  We call this platform “Develop UA”™ and expect to formally roll it out to the world in the middle of October, 2019 regardless of whether it is raining, or sunshine in Kyiv and Washington, DC.

relevant links

http://www.usubc.org/site/recent-news/doing-business-in-ukraine-now–usubc-roundtable-in-washington

https://ukrainian.voanews.com/a/amerykanksy-biznes-ukrayina/5051657.html

 

World Affairs Councils of America Welcomes Broad Street Capital Group as National Affiliate Member and Sponsor

Washington, DC, May 14, 2019 — The World Affairs Councils of America (WACA) is pleased to announce that Broad Street Capital Group (www.broadstreetcap.com) has joined WACA as a National Affiliate Member, sponsor of the WACA National Conference, and member of its prestigious 1918 Society.

Broad Street’s expertise in advising on foreign direct investment (FDI) strategies in emerging and frontier market countries and WACA’s ability to convene foreign government leaders and influential audiences through its extensive network of more than 90 World Affairs Councils across the United States will provide a powerful platform for U.S. companies targeting investment opportunities and seeking policy and regulatory knowledge in these markets.

Broad Street will tap the WACA platform to conduct a national tour to educate potential U.S. investors on available U.S. Government financing options, as well as political and trade risk mitigation tools. WACA will assist Broad Street in organizing bilateral trade missions and curated foreign policy tours to highlight economic advantages of the target markets and to facilitate trade and investment opportunities.

“It is an honor and a privilege to become WACA’s newest National Member,” said Alexander Gordin, co-founder and Managing Director of the Broad Street Capital Group.  “My colleagues and I look forward to helping this prestigious 100-year old national organization to grow into the next century of its existence.  Foreign direct investment is an essential  part of sound foreign policy for any nation and having such an esteemed partnership with the WACA network’s convening power on this issue, would definitely bring significant measurable results.”

“WACA is delighted to collaborate with Broad Street and we look forward to inviting leading investors and representatives of foreign investment agencies as guests of the Broad Street Capital Group at WACA’s 2019 National Conference in Washington, DC,” said Bill Clifford, President and CEO of the World Affairs Councils of America.

Scheduled for November 6-8 at the Mayflower Hotel in DC, the WACA Conference will feature more than 50 leaders and policy experts on the theme: “The 8 Forces Reshaping the Global Economy.”

About the Broad Street Capital Group

Based in the heart of New York City’s Financial District, Broad Street Capital Group (www.broadstreetcapital.com) is an international private merchant bank, which since 1988 has served several foreign governments, multiple state-owned companies, as well as SMEs in emerging markets. Through its member companies, the Group focuses on developing project financing in the $100 million to $1 billion range, providing political risk mitigation, export management services and cross-border market development advisory. The Firm maintains a permanent presence in London, Budapest, Kyiv, Tashkent, and  Astana, .  Since its founding, Broad Street Capital Group has done business in over 35 countries, spanning the emerging markets landscape from Bangladesh to Ukraine.

The Firm works closely with all trade and development agencies of the U.S. Government and Export Credit Agencies of several European and North American countries. Since its inception, Broad Street Capital Group has been involved in multiple high-profile cross-border transactions in IT/telecom, aerospace, health care, energy generation, food security, nuclear safety, hospitality and franchising sectors. The firm’s current advisory and export management portfolio exceeds $900 million.

About the World Affairs Councils of America

The World Affairs Councils of America (www.worldaffairscouncils.org) is an independent, nonpartisan organization dedicated to engaging the public and leading global voices to better understand the world, America’s international role, and the policy choices that impact our daily lives and our future. WACA carries out its mission by:

• Supporting more than 90 World Affairs Councils across the United States and promoting programs and educational initiatives for diverse local audiences – from classrooms to C-suites, from town-hall style community forums to conferences in the nation’s capital.
• Developing Councils’ convening power nationwide by providing face-to-face connections and dialogue with global leaders, business executives, policy and trade experts, ​social innovators, and distinguished opinion makers.
• Partnering with organizations that seek to reach out to “grassroots” and “grasstops” citizens, disseminate research, mutually expand networks and transform how people, enterprises, and governments think about the world.
• Challenging the next generation to develop leadership skills and global acumen so that our communities can better compete, collaborate, and make informed decisions.

 

Financing projects in Ukraine – USUBC round-table announcement

INVITE:  “FINANCING FOR BUSINESS” – US EXIM OPEN FOR UKRAINE, EBRD, OPIC ROUND-TABLE

               Tuesday, March 12, 2019, 3 p.m to 5 p.m. Law Offices of McCarter & English,   
1301 K St., NW, Suite 1000 West Tower, Washington DC 20005

INVITATION: The U.S.-Ukraine Business Council (USUBC), www.USUBC.org, invites you to attend a “FINANCING FOR BUSINESS – US EXIM OPEN FOR UKRAINE, EBRD, OPIC ROUND-TABLE, on Tuesday, March 12, 2019, from 3 p.m. to 5 p.m., with a light reception, in the offices of USUBC member, McCarter & English, 1301 K St., NW, Suite 1000 West (10th Floor), Washington, DC 20005.  The following panel of experts will make presentations followed by a discussion/Q&A session.

PROGRAM: PANELISTS FOR THE ‘FINANCING FOR BUSINESS’ ROUND-TABLE INCLUDE:

(1)  Douglas Frye, Senior Business Development and Loan Officer, Global Infrastructure, Export-Import Bank of the United States (EXIM)
          (2)  Alexander Gordin, Managing Director, Broad Street Capital Group, merchant bankers, specialist in US EXIM & OPIC type project transactions
(3)  Bruce Drossman, Senior Vice President, Global ECA Advisory and Execution, General Electric, GE Energy Financial Services/Global Capital Advisory (with US EXIM for four years)
(4)  Michelle Small, Head of North American Representative Office, European Bank for Reconstruction and Development (EBRD)
          (5)  Kenneth Angell, Managing Director, Project Finance & Tara Blake, Director, International Project Finance, Overseas Private Investment Corporation (OPIC) 
          (6)  John Strayhorn, President, Global Insurance Services, EXIM approved insurance broker
(7)  Morgan Williams, President, U.S.-Ukraine Business Council (USUBC), Moderator

RSVP:  Registration is required for attendance at the USUBC Financing for Business Roundtable. Please register by sending an e-mail to mwilliams@usubc.org. There is no charge for the meeting. Photo ID is required. USUBC thanks McCarter & English law firm, a new member of USUBC, for hosting the USUBC Business Luncheon in Washington.

“FINANCING FOR BUSINESS” – US EXIM OPEN FOR UKRAINE, EBRD, OPIC ROUNDTABLE
Tuesday, March 12, 2019, 3 p.m to 5 p.m. Law Offices of McCarter & English,
1301 K St., NW, Suite 1000 West Tower, Washington DC 20005. followed by a light reception

Grey2White Workshop Hosted by the USUBC, Puts an Exclamation Point on the International Trade Mission

 

On Wednesday, September 12th, US-Ukraine Business Council (USUBC), in cooperation with the law firm of Brown Rudnick, Broad Street Capital Group and Ankura Consulting, held its second Grey2White ™ workshop in Kyiv. Over 45 guests attended, including the Former First Lady of Ukraine, Kateryna Yushchenko.

The Grey2White workshop resulted in consensus among the participants on the need of Grey2White program in Ukraine and in other post-Soviet countries. The lively and spirited discussion continued after the official part of the program was concluded.

The workshop’s presenters featured financiers, former prosecutors with the US Department of Justice and enforcement attorney with the US Securities Exchange Commission.

Grey2White workshop served as the exclamation point on the highly successful International Trade Mission through Ukraine and Uzbekistan, in which the speakers of the Forum participated, along with representatives of eight companies from four countries.

During the Mission, its participants conducted a number of high-level government, NGO and private sector meetings to identify and engage projects in the areas of healthcare, ICT, energy savings, agriculture and aerospace. Over $1.32 billion of project mandates are expected to be awarded to the Mission Participants in the next 60-90 days. Companies wishing to participate in the projects, which have started the development during the Trade Mission, will have an opportunity to learn more during the upcoming International Opportunities conference in November, hosted by the Broad Street Capital Group.

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President of Kazakhstan visits pioneering Center of Tomotherapy and Nuclear Medicine, program managed by the Princeton Healthcare Alliance

(Astana, Kazakhstan)Yesterday, August 29th, President Nazarbayev of Kazakhstan visited a newly opened Center of Tomography and Nuclear  Medicine at the National Research Hospital in Astana the capital of Kazakhstan. Prime Minister of Kazakhstan Hon. Bakhytzhan Sagintayev and the Minister of Health Hon. Elzhan Birtanov were also in attendance.

President Nazarbayev expressed his support for the outstanding effort by Dr. Abay Baigezhin, Director of the hospital and praised the Consulting Radiation Oncologist Dr. Daniel Fass, Chief Medical Officer of the Princeton Healthcare Alliance (PHA), for bringing this state-of- art technology to the people of Kazakhstan.  Dr Fass, who is internationally recognized as a pioneer in Radiation Therapy with over ten years of experience utilizing  Accuray’s Tomotherapy HI-HD equipment explained to the President the unique advantages of that system in treating many malignancies. “This is the first Tomotherapy installation in Central Asia. It is expected patients from throughout the region will be treated at the center.” said Dr. Fass

The clinic will begin treating patients in November and currently has staff training in the Madison, Wisconsin. Building on the success of this project the Clinic plans on expanding to other therapeutic modalities including immunotherapy and stem cell treatments harnessing the advances in precision medicine . Princeton Healthcare Alliance is dedicated to bringing US technology, expertise and financial solutions to improve the lives of citizens in emerging markets the world over.  Next week Dr. Fass, along with other members of the Princeton Healthcare Alliance, will travel to Tashkent, as part of the Trade Mission led by the Broad Street Capital Group (www.broadstreetcap.com) to identify, structure and finance advanced healthcare solutions for the Republic of Uzbekistan

Broad Street Capital Group to lead an international Trade Mission to Uzbekistan.

For Immediate Release

New York, August 26, 2018. Fresh from its success of developing a pioneering $250 million, 20-year OPIC insured, capital markets financing, Broad Street Capital Group announced today that it will lead an international Trade Mission to Uzbekistan between September 5th and 9th, 2018.

The goal of the Trade Mission is to identify and engage large project development and financing opportunities in the areas of health care, distributed and renewable energy generation, agriculture, ICT and aerospace. 

With its proven ability to develop and structure complex financing solutions ranging from $100 to $500 mil., and utilizing support of Export Credit Agencies (ECAs), such as US EXIM Bank, and of US government development institutions,
such as Overseas Private Investment Corporation (OPIC), Broad Street Capital Group is uniquely positioned to bring low-interest, long-term financing to projects to be developed by the Trade Mission participants and supported by the Government of Uzbekistan.

The mission participants will also introduce an innovative Grey2White™ initiative designed to assist local companies in becoming more bankable and transparent to western partners and international financial institutions.

Joining Broad Street Capital’s team during the upcoming Mission will be representatives of US, UK and Israeli companies, international law firms and professional organizations. The delegation will be led by Mr. Alexander Gordin, Managing Director of the Broad Street Capital Group and will meet with a number of federal and local Government Officials, project sponsors and company owners in Tashkent.

“Uzbekistan represents a tremendous opportunity for international project development and international business cooperation,” said Alexander Gordin. “Policies implemented by President Mirziyoyev have been very effective in attracting foreign investment, supporting technology transfer and focusing on growing key areas of the Uzbekistan’s economy,” added Gordin.

About the Broad Street Capital Group

Based in the heart of New York City’s Financial District, Broad Street Capital Group (www.broadstreetcap.com) is an international private merchant bank, which since 1988 has served several foreign governments, multiple state-owned companies, as well as SMEs in emerging markets. Through its member companies, the Group focuses on developing project financing in the $100 million to $1 billion range, providing political risk mitigation, export management services and cross-border market development advisory. The Firm maintains a permanent presence in Astana, Kazakhstan and Kyiv, Ukraine.  Since its founding, Broad Street Capital Group has done business in over 35 countries, spanning the emerging markets landscape from Bangladesh to Ukraine.

The Firm works closely with all trade and development agencies of the U.S. Government and Export Credit Agencies of several European and North American countries. Since its inception, Broad Street Capital Group has been involved in multiple high-profile cross-border transactions in IT/telecom, aerospace, health care, energy generation, food security, nuclear safety, hospitality and franchising sectors. The firm’s current advisory and export management portfolio exceeds $900 million and expected to exceed $1.5 billion by November 15th, 2018.

For more information contact: Rustem Tursyn, Representative for Central Asia

+1 212 705 8765 ext. 707, or via email rtursyn@broadstreetcap.com

 

Broad Street expands its risk mitigation services

(New York City, NY, May 2, 2018)   For Immediate Release

Broad Street Capital Group (BSCG) proudly announces the formation of the Broad Street Risk Mitigation LTD., which will serve as the Group’s risk mitigation and insurance specialist.

Broad Street Risk Mitigation will focus on originating and placing complex Political Risk Insurance (PRI) Transactions, as well as on trade finance, export credit, freight and travel medical insurance for project teams.

In cooperation with several major law firms and government agencies, the company will also focus on development and implementation of FCPA and OFAC compliance policies for its clients.

Heading the new entity will be Mr. Paul Gregory, who has joined the Firm as its Principal and Head of Insurance Operations.  Mr. Gregory brings with him over 40 years of distinguished service in the insurance and risk management fields.  He has held multiple management and directorship positions at the internationally known companies and has been involved in complex insurance transactions in over 20 countries.  Mr. Gregory’s relationship with the Broad Street Capital Group goes back over a decade. He advised the BSCG on several export-related transactions and provided invaluable guidance on the company’s dealings in Kazakhstan and Hungary.

Concurrently, with his joining the Broad Street Risk Mitigation LTD., Mr. Gregory has also accepted an Advisory Board position at the Broad Street Capital Group

About the Broad Street Capital Group

Based in the heart of New York City’s Financial District, Broad Street Capital Group (www.broadstreetcap.com) is an international private merchant bank, which since 1988 has served several foreign governments, multiple state-owned companies, as well as SMEs in emerging markets. Through its member companies, the Group focuses on developing project financing in the $100 million to $1 billion range, providing political risk mitigation, export management services and cross-border market development advisory. The Firm has done business in over 35 countries, spanning the emerging markets landscape from Bangladesh to Ukraine.

The Firm works closely with all trade and development agencies of the U.S. Government and Export Credit Agencies of several European and North American countries. Since its inception, Broad Street Capital Group has been involved in multiple high-profile cross-border transactions in IT/telecom, aerospace, healthcare, energy generation, food security, nuclear safety, hospitality and franchising sectors. The firm’s current advisory and export management portfolio exceeds $917 million and expected to exceed $1.5 billion by November 15th, 2018.

For more information contact Alexander Gordin, Managing Director +1 212 705 8765 ext. 701 or via email agordin@broadstreetcap.com

 

Broad Street Capital and GreenMax join forces in Africa.

(New York, April 26th, 2018) Broad Street Capital Group and GreenMax Capital Group join forces to develop and finance large-scale energy projects in Africa.

“We are excited to announce a new partnership with Broad Street Capital Group (BSCG), a New York based emerging markets focused merchant bank. BSCG has recently led a landmark transaction in Ukraine that is a game-changer for enabling financing of parastatal and direct state sponsored infrastructure projects. The facility is a US OPIC wrapped bond issue that for the first time offers 100% long-term debt financing at very low financing rates.” wrote Cliff Aron, Managing Principal at GreenMax.

Owing to GreenMax’s strong Africa footprint and the company’s longstanding relationship with the Broad  Street Capital Group, the Greenmax organization was selected to lead the introduction of this innovative financing product to the African energy sector. The minimum project size is $150M  and the project must be implemented by a State agency, or parastatal.  In the later case, the host Government must provide a sovereign guarantee.

Broad Street and GreenMax plan to formally launch the product for Africa energy infrastructure at the Africa Energy Forum in Mauritius in June. The joint venture is seeking Power Africa sponsorship for this initiative and expects to be able to secure USTDA grant funding to support the preparation phase for any worthy projects. Although many countries in Africa will qualify for the financing being offered, projects in Nigeria, Uganda, Mozambique and South Africa will be of particular interest.

For more information contact Cliff Aron – cja@greenmaxcap.com

 

Grey2White Initiative – the journey continues (parts I and II)

™

(Part I of the article reprinted from the June 2017 issue)

Hypothesis:

Given Ukraine’s current economic and geopolitical situation, one of the most beneficial  steps the US government, business and NGO community can take, is to encourage significant external and internal direct investment into the country’s economy.

Although the US Government has had some success in attracting and supporting American direct investment into Ukraine, those investment amounts are far from sufficient. US investors new to the Ukrainian market are wary of the country’s reputation for corruption, difficulty in doing business, threats from Russia and lack of financing options.

A second and much more viable economic development option, would be to support and enable direct investment by the successful Ukrainian business people who have amassed sufficient capital and are much more comfortable and adept in investing in their home market.

One problem with pursuing that option are high Western standards, which often preclude US government development agencies and public US investors from working with this potential class of investors.  This is due to the fact that for the last twenty-five years, practically all business people in Ukraine had to operate under a certain set of conditions widely considered “grey” and in many cases “black” in the West.

Some of these “grey” conditions are lack of financial transparency, inadequate corporate governance, use of yellow press, use of cash, as well as offshore accounts to conduct operations, bribery and use of adverse political influence.

In their attempts to succeed, some folks in Ukraine went beyond previously acceptable business norms and crossed the proverbial line even further by engaging in criminal “black” behavior – graft, extortion, corruption, tender rigging and illicit drug trade.

To date, these grey conditions have presented significant challenges for the IFIs, development agencies and regulated financial US investors. Yet, it is vital to recognize the necessity to find an acceptable solution that allows Ukraine’s economy to reap significant benefits from the anticipated increase in direct investment and low-cost, long-term financing.

It is also very important to understand that the proposed Grey2White (G2W)™ initiative aims to broaden and scale up very important development and capacity building work already undertaken over the last quarter century by IFIs, such as IFC and EBRD, USAID; development agencies such as OPIC and USTDA and financial investment communities. Those initial efforts, although quite effective, focused on a relatively small sample of Ukrainian companies and were undertaken during a different stage of the country’s development.

Initiative

The G2W™ initiative will only work with those companies and individuals, who will be able to create meaningful economic impact in Ukraine, after undergoing the conversion process.  G2W™ will not in any way target those convicted of the “black” behavior, as their reputation gap is un-bridgeable within the scope of the project.

Thus the question becomes, is it possible for US stakeholders to create an environment and a broad platform from which so-called “grey” Ukrainian businessmen seeking to utilize US financing, equipment, services and franchises, as part of their major investment programs, become “bankable” under Western standards? If the answer is “Yes.”This type of conversion will provide hundreds of millions, if not billions of dollars in direct economic benefit and enhanced geopolitical security to Ukraine and to the US.

If the answer is “No,” these businessmen will either be forced to forgo the planned capital investments, or seek alliances with other grey, or black global actors in countries like Russia, China, Brazil, Iran, etc.

It is the fundamental belief by the creators of the proposed initiative that given a concerted effort by the US and Ukrainian stakeholders to develop and implement realistic procedures to increase corporate transparency, introduce financial standards, address any existing reputation issues head-on and provide reputable outside management and board oversight, it is possible within short to medium time-frames to bring these so called “grey” businessmen and their respective projects up to elevated western standards, mitigate investment and reputation risks and affect substantial economic growth in Ukraine.

Thus we hereby propose the following:

Select three-four financially viable projects sponsored  the “grey” Ukrainian actors and use them as a pilot to develop, refine and implement an effective conversion strategy to bring that project up to acceptable Western standards.

From the government side, we propose to involve the US Commercial Service, USTR, US Embassy, Ukrainian Embassy, Cabinet of Ministers of UA, members of the US Congress focused on UA issues, OPIC, regional Governors and local administrations in Ukraine, IFC, USTDA and the US EXIM Bank (when that Agency resumes its activities in Ukraine).

Among the NGO stakeholders we would like to see US-Ukraine Business Council (USBC), AMCHAM, Transparency International, Freedom House, Atlantic Council and US Ukraine Foundation. Additionally, reputable international law firms, audit firms, press, appropriate private individuals, corporate off-takers, financial market regulators, as well as relevant providers of US goods and services should be involved.

The framework of the proposed initiative shall be as follows:

• Initial Sponsor/Project assessment and preliminary due diligence
• Project selection and stakeholder awareness and involvement
• Project G2W™ Team building (attys., directors, advisers, auditors, suppliers, investors etc.)
• Full due diligence and implementation plan for the Western financial, FCPA and governance standards
• Investor cultivation and underwriting of the financing package
• Project development and implementation
• Monitoring and compliance

To kick off the proposed initiative, we propose an intensive education and awareness-building campaign designed to simultaneously involve all the stakeholders.

After the initial buy-in into the initiative is secured, work will begin on developing the pilot projects.

During the pilot project phase, the G2W pilot project team will be seeking to achieve specific and tangible goals:

• Fully assess the existing reputation risks, possible political influence issues, suitability for OPIC/IFC financing and Political Risk Insurance for the US project participants
• Prepare a legal due diligence report by a world-class law firm
• Recruit highly reputable and competent outside board members to the Project’s Board
• Design a comprehensive PR/IR strategy to inform stakeholders of the project and its ongoing developments
• Design and implement transparent financial audit, reporting and management accountability standards
• Develop ways to tangibly measure economic effect of the pilot project
• Continue to promote the initiative and seek to move it from the pilot project phase to full-blown implementation.

(to be continued)

                                                    ^{*********************************************************}

Part II  (April 2, 2018)

In the nine months since the above article was first published, a number of events took place, which not only validated the concept behind the Grey2White™ initiation, but also expanded its scope and attracted top notch global professionals to the program.

Although initial premise of the program to convert grey actors in Ukraine to white bankable actors, whose economic contribution will greatly outweigh any possible transgressions they may have committed up to this point remains intact, the program has been expanded to include other emerging market countries of Eastern Europe and Central Asia. The program also grew to allow so-called grey companies to unlock their value through financial and legal transformation in order and become more bankable in the Western capital and financial markets. Part of this transformation involves tools, which on one hand provide increased political protection to the current management and to foreign investors, and on the other hand allow western companies to lock up predictable valuations and to observe the transformation process first hand.

A first rate international “scrub team” has been assembled as a multidisciplinary team consisting of former US Government prosecutors, forensic accountants, legal and financial experts and last but not least, former high-level grey operator with deep expertise in shadowy government and business dealings in Ukraine and several other  post-Soviet countries.

A pilot company and its owner have been selected, as the first of four pilots companies to undergo Grey2White™ transformation in order to make them bankable by US Development Agencies for a $150 million project slated to create over 200 new jobs and to generate significant economic impact in Southern Ukraine.

In the next 60 days. key members of the G2W™ Team are expected to travel to Latvia, Kazakhstan, Azerbaijan, Uzbekistan and Ukraine to conduct additional screening and selection of the pilot companies and individuals.

In the subsequent parts of this article, we will examine the different case studies and watch the pilot candidates undergo the first steps of the Grey2White™ transformation.

(to be continued…)

 

Financing Feasibility Fund I (FI3F) – a $30 mil. Global Project Development Fund announced by the Broad Street Capital Group

(New York City, NY, February 20, 2018)   For Immediate Release

Fresh from its recent success, as the Financial Developer of the $250 million OPIC insured capital markets financing for NAEK Energoatom of Ukraine, Broad Street Capital Group has announced today that it will establish a $30 mil. Financing Feasibility Fund I (Fi3F™) – a global project development fund to provide feasibility grants and pre-financing development funding for qualified emerging markets’ OPIC-insured infrastructure projects to be financed in the US capital markets.

The Fund will provide qualified Governments and State-owned borrowers feasibility seed funding in the amounts between $350,000 and $1 million dollars and pre-financing bridge loans in the amount of $1.25 to $2.5 million per project.

The Fi3F™ Fund will develop and seed international projects whose financing requirements fall between $150 mil. and $1 billion, and which will span the industry segments ranging from energy, airspace, transportation to agriculture, infrastructure and healthcare. The projects should be located in credit-challenged emerging market countries, which represent priority markets under OPIC’ development finance and insurance mandate. Financing terms for the projects will be between 10 and 20 years. A strong US supply nexus and willingness of the host governments  to provide sovereign guarantees for the financing, will be key considerations during the project selection stage.

Participation in the Fi3F™ will be open to qualified private and institutional  investors, with at least 51% of all the shareholders being US nationals. The management of the fund will utilize proven project development techniques and will be administered by an experienced team consisting of leading legal, insurance and financial experts, a placement agent and the financial developer. The Fund will obtain Political Risk Insurance from OPIC to protect its funds and will retain a top tier investment bank to act the the Paying Agent to administer all the payments and disbursements. Fi3F’ returns are targeted to fall in the 12-17% range annually.

Call for the first round of Financing Feasibility Proposals will commence April 25, 2018.

About the Broad Street Capital Group

Based in the heart of New York City’s Financial District, Broad Street Capital Group (www.broadstreetcap.com) is an international private merchant bank, which since 1988 has served several foreign governments, multiple state-owned companies, as well as SMEs in emerging markets. Through its member companies, the Group focuses on developing project financing in the $100 million to $1 billion range, providing political risk mitigation, export management services and cross-border market development advisory. The Firm has done business in over 35 countries, spanning the emerging markets landscape from Bangladesh to Ukraine.

The Firm works closely with all trade and development agencies of the U.S. Government and Export Credit Agencies of several European and North American countries. Since its inception, Broad Street Capital Group has been involved in multiple high-profile cross-border transactions in IT/telecom, aerospace, healthcare, energy generation, food security, nuclear safety, hospitality and franchising sectors. The firm’s current advisory and export management portfolio exceeds $417 million and expected to exceed $1.5 billion by November 15th, 2018.

This announcement is for informational purposes only and does not constitute an offer or solicitation to sell shares or securities in the Company or any related or associated company. Any such offer or solicitation will be made only by means of the Company’s confidential Offering Memorandum and in accordance with the terms of all applicable securities and other laws. None of the information or analyses presented are intended to form the basis for any investment decision, and no specific recommendations are intended.

For more information contact Alexander Gordin, Managing Director +1 212 705 8765 ext. 701 or via email agordin@broadstreetcap.com