AUTHORIZED CAPITAL OF VENTURE FUND TO MAKE $40 MILLION

ARKA
Dec 1, 2009

YEREVAN, December 1, /ARKA/. Vache Kirakosian, head of an economy
ministry department in charge of information and high technologies,
said Monday the authorized capital of a venture fund to be established
in Armenia will make $40 million.

Speaking at a news conference at Novosti Armenia International Press
Center, he said the venture fund is being established by the government
of Armenia and the Russian Sitronix company. He said the venture fund
will be registered soon and the initial $40 million are expected to
double in the second and future stages of the project. The Armenian
government’s share in the project will be between 10-15%, he said,
adding that the government will insist that its funding be directed
at financing new companies and fresh ideas.

He said the World Bank and some other international organizations
are taking interest in this project.

The venture fund is supposed to be established on the basis of Mars
electronic plant that was handed to Russia as part of a deal christened
Assets for Debt whereby Armenia handed five enterprises to Russia to
clear its almost $100 million debt.

According to estimates, from $3 to $6 million of the venture fund may
be spent on creation of the seed fund for development of projects at
the initial stage. The selected projects will be implemented at Mars
plant, which was built in 1988-94 for production of printed-circuit
boards. Currently the plant operates at a fraction of its capacity. In
2008 Mars plant, as well as the Institute of Material Science,
Institute of Mathematical Machines and Automated Systems were handed
to Russian Sitronix company, which plans to merge them into a single
research center.