Salmon's earnings have seen a significant increase.
In the Pacific waters of Russia, the "Vostok" salmon fishing empire, worth a cool 13-15 billion rubles, has seen a shift in power. The AFK "System" corporation, once its proud owner, has now passed the mantle to Milan Kerimova, a mysterious figure in the fish market. Despite years of tireless efforts, AFK struggled to make "Vostok" profitable, a hurdle it faced partly due to a 50% drop in salmon catches last year.
Kerimova's JSC "Insoft" has nabbed control of JSC "More Project", which, in turn, owns a whopping 99.9% of the "Vostok" fish processing holding. This revelation is tucked away in the 2024 annual report of "More Project", published at the tail end of April 2025. Insider chatter suggests that the buyer is none other than Milan Kerimova. A chorus of industry insiders isn't ready to rule out the possibility that Kerimova could be acting on behalf of AFK "System". A name previously unheard of in the fish market, Kerimova's whereabouts remain elusive, as our efforts to reach her have been fruitless. "Vostok" has also kept mum about the change in ownership, and AFK "System" has politely declined to comment.
Ivan Peshkov, a grandmaster of M&A at BGP Capital, believes the "Vostok" holding is valued at a hefty 13-15 billion rubles, including any outstanding debt. However, according to SPARK data, the business is a far cry from the profitability indicators we'd hope for. In 2024, the company's revenue was a mere 115.7 million rubles, resulting in a net loss of 195.7 million rubles. The combined turnover of the four structures under its control plummeted by 27.4% compared to the previous year.
"Vostok" holds the title of one of the largest Russian producers of Pacific salmon. Its empire includes 30 fishing grounds, 6 factories, and over 35 ships. These resources churn out an impressive 24,000 tons of final products, red fish, and caviar annually.
Back in 2021, AFK "Systema" began snatching up fish processing assets in Kamchatka, which eventually made up the RPP "Vostok". Come November 2023, it was reported that OAO "Krauninvest" of Olga Zachenyaeva had acquired 22.5% of the holding. However, this structure disappeared from the list of founders sometime later.
The sale of AFK "Systema's" entire Pacific salmon fishing business could be due to several reasons.
Firstly, exporting products to specific countries could pose a challenge due to sanctions imposed on AFK and its co-owners, Vladimir and Felix Evtushenkov. As much as 70% of the salmon catch in the Far East is destined for foreign markets. Sanctions can block payments and impose port restrictions, potentially crippling the fishing industry.
Secondly, it's all about the economy. The year 2024 was a rough one for salmon fishing companies due to a significant drop in catch volume. Last year's catch dwindled by more than half year-on-year to 235,400 tons, a rarity since 2005.
Fishing companies heavily rely on credit funds, and the surge in the central bank's key rate has become a thorn in their side. The profitability of Russia's fishing industry has plunged from 60% in 2018-2021 to 33% in 2022-2024, while Kamchatka's languished from 57.5% to 20.6%. Fish processing in Russia has seen its profitability fall from 24.7% to 11.6% over the past four years. However, investments in the business of catching salmon species remain profitable due to the growth in global consumption and state support measures.
So, who is this new player in the fish market? Well, that remains a mystery, but we're on the case and will keep you posted!
- Milan Kerimova, a previously unknown figure in the fish market, has taken control of the "Vostok" fish processing holding, as revealed in the 2024 annual report of JSC "More Project".
- Despite its ownership change, "Vostok" continues to produce approximately 24,000 tons of final products, red fish, and caviar annually, across 30 fishing grounds, 6 factories, and over 35 ships.
- The sale of AFK "Systema's" entire Pacific salmon fishing business might be attributed to the challenges in exporting products to specific countries due to sanctions, as well as the economic struggles caused by a significant drop in catch volume.
- The mystery surrounding the identity of Milan Kerimova, along with possible involvement from AFK "System", and the future financial performance of the "Vostok" holding in the face of these challenges, remain intriguing questions for the fish industry and financial analysts.
