1. NewRussiaGrowth Private Equity Advisors Landscape and Evolution of Private Equity in Russia Andrey Dobrynin Managing Partner November 2009

3. What was Russian PE industry before the crisis?

4. What happened with portfolio companies, GPs and LPs during the crisis?

5. Whatnew financial products were developed?

6. How will Russian PE industry evolve in the next few years?2

7. Russian macro picture Industrial production, y-o-y % Real disposable income, y-o-y % Source: State Statistics Committee Source: Central Bank of Russia RTS index USD/RUB Source: RTS Source: Central Bank of Russia 3

9. Only few are local and independent

10. Most are subsidiaries of investment banks, family offices or foreign PE groups

11. Growth capital is main investment strategy

12. Target industries: retail, financial sector, consumer services, telecoms4

14. Volga River One: size - $177m, first closing - 2006; number of LPs – 20

15. 6 investments: telecoms, retail, food production

16. Valuation : 116% of invested capital (E&Y)

17. Volga Credit Opportunity – fundraising $250m5

18. What happened to PE investments? % of bad loans to total portfolio of Russian banks Retail trade turnover, y-o-y % Source: NRG estimates Source: State Statistics Committee Food & beverage production, y-o-y % Broad-band Internet subscribers, m Source: PWC, NRG estimates Source: State Statistics Committee 6

19. NRG Private Equity Portfolio: Case study Ufanet: sales & EBITDA, $ m Genser: sales & EBITDA, $ m Source: company data Source: company data Ufanet: number of subscribers, ths Genser: debt, $ m 7 Source: company data Source: company data

21. Focus on mid and low price segments

22. 50 own and 32 franchisee shops in 81 cities across Russia

23. Secured debt $20m with current interest 18% and equity kickers

24. Expected IRR: 42-48%, floor IRR is 30.5%8

26. Return to classic “growth capital” model in 12-24 months

27. Limited availability of debt

28. Poor track record will create difficulties in fundraising for many GPs

29. Low deal competition

30. Attractive valuations and high IRRs9

32. 18 institutional GPs with AUM of more than $150m before the crisis

33. Only a couple of GPs left with significant amounts of dry powder

34. Most PE portfolios have been hit hard

35. Interesting opportunities are available in the credit market

36. Few successful GPs will enjoy low competition in the next couple of years10