International company Middlesex

During 1996 MiddleSex diversified its non-ferrous business into nickel. In October 1996 it entered into a short-term pilot contract with

Napo Invest and Trade Corp., a company incorporated in the British Virgin

Islands and run by Mr. Yuri Murkin, a business associate of Mr. Alikhani, and two Russian companies: Koks, which owns the Kemerovo coke plants and

Kombinat Yuzhuralnikel, one of the biggest Russian nickel producers.

The government recently sold its 38% in troubled Norilsk Nickel, the biggest but also heavily debt-ridden Russian nickel producer. Following the

Norilsk example, Yuzhuralnikel could be the next to be auctioned. Interfin,

MiddleSex’s 40% owned investment, has already secured a 14.7% interest in the Yuzhuralnikel nickel plant, which gives MiddleSex a 5.9% indirect interest.

Overall I believe that MiddleSex is in strong position if it decodes to increase its interest in

Yuzhuralnikel and therefore its Yuzhuralnikel exposure to nickel. However,

I have assumed that MiddleSex will only extend the trading with

Yuzhuralnikel.

Financial Services

The backbone of MiddleSex’s financial services operations is the 40% owned Interfin (Interbank Investment and Finance Company). The remaining

60% is held by GAZPROM (20%), OEMK(20%) and Mapo Bank(20%). MiddleSex’s financial services include:

. trading in Russian capital markets;

. financial advise to western companies or potential business in Russia, and

. advice to Russian companies entering western capital markets.

Established in late 1994, Interfin commenced by trading in Russian treasury. Initial returns were good and Interfin quickly made substantial profits, which enabled the company to start bying stakes in various

Russian companies. As a result, Interfin has built an impressive asset base of which the company estimated to be in excess of US$300m.

MiddleSex - GAZPROM relationship

MiddleSex holdings - a small, London based trading group - is advertising the world biggest producer and Russia’s biggest company GAZPROM on cheaper ways to raise finance. The appointment came as a result of the close contact between MiddleSex’s and Interfin’s top management and

GAZPROM. Principally the role consist of :

- Providing independent advice in relation to the selection and implementation of different fund raising strategies and regulatory requirements of international capital markets;

- Liaison with advisors, once appointed, on behalf of GAZPROM as well as coordination of GAZPROM’s fund raising and corporate activities;

- Assisting in the design and implementation of special project finance schemes and structured long-term program of public and investor relations aimed at strengthening GAZPROM’s position in the international capital markets.