JPMorgan held talks to buy Troika Dialog

JPMorgan Chase & Co., the third-biggest US bank, is considering acquiring a stake in Moscow-based Troika Dialog to bolster its securities arm in Russia, people familiar with the matter said. Kristin Lemkau, a spokeswoman with New York-based JPMorgan, declined to comment, as did Troika spokeswoman Anna Kharnas. JPMorgan is among international investment banks, seeking to expand in Russia as an eighth year of economic growth spurs a surge in initial public offerings and takeovers.

Russian companies may raise as much as $18 billion in IPOs in 2006. Goldman Sachs Group Inc. said earlier this month it obtained a license to become a securities dealer in Russia. „There is a lot of investment-banking activity in Russia right now and the global majors want a way to get in to Russia and hit the ground running,” said Coast Sullenger, a fund manager at Gaia Resources in Geneva. „We will see an acquisition or two within the next year, it's just a matter of time.” Troika and Aton Capital Group would be likely targets for takeovers because they are decade-old independent banks with strong Russian client bases, Sullenger said. Aton, which had earlier spoken with JPMorgan, most recently held talks with Bank Austria Creditanstalt AG, according to the people familiar with the matter.

Troika's stock turnover nearly doubled last year to $74 billion, accounting for 14% of total share transactions on Russian bourses and the over-the-counter market, according to the company's Web site. Its money-management arm oversees more than $3 billion. The firm, which has offices in New York and London, has nearly doubled its workforce in the past year to about 700. Troika has managed two stock sales valued at $149.5 million since January 2004, placing 12th among securities firms, according to Bloomberg data. The bank managed exclusively a 3% private placement of shares in OAO Novatek, Russia's second-largest gas producer, and 10% of Amtel-Vredestein NV, a Russian tire producer. It has also taken part in the initial public offerings of AFK Sistema, a Russian holding, and Novatek. (Bloomberg)