Russian Investment Firm Sistema Blasts “Erroneous” Defense Industry Ties Claims


London-listed Russian investment company Sistema said it “owns no stakes in any companies in the defense industry”. The statement on the company’s website came after some media incorrectly reported that two of its portfolio companies were allegedly involved in arms manufacturing.

“Sistema notes recent erroneous media speculation regarding its ownership of [microelectronics producer] RTI and [high-tech engineering firm] Kronstadt. The Corporation reduced its shareholdings in RTI and Kronstadt below controlling level in July 2021 and has since completely divested from both companies”, according to the statement.

Sistema’s investment portfolio includes stakes in Russia’s largest mobile operator MTS and leading online retailer Ozon, as well as residential property developer Etalon Group, private healthcare provider Medsi, forestry company Segezha Group and a number of IT and high-tech firms. Sistema reported revenue of RUB802.4 billion (EUR9.21 billion) in 2021.  

Sistema was established in 1993, and went public on the London Stock Exchange in 2005, raising over $1.5 billion from EU and US investors. The company’s GDRs have been suspended since March 4, when the LSE suspended trading of all Russian equities in response to Russia’s invasion of Ukraine.

Russia in turn at the end of April banned shares and GDRs of Russian companies from trading abroad. Sistema has appealed against the decision and hopes to keep its GDRs in circulation in London. A Russian government commission is currently considering the company’s appeal.


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