After Nurgazy and Mr. A split, Nurgazy asked if investing in his new business was an option. Since we had already spent so much time analysing the business and the industry, we decided to look into it. We agreed to buy 45% of the business for US$110.000. Fifty percent of the total investment amount was payable on signing, and the balance to be paid when the monthly sales volume exceeded 2 million soms. The purchase price included buying land as an investment property. It was a 1.2 hectares commercial land located on the main highway on the Bishkek CBD fringe. The price of the land was US$55,000. Our share was $25,000 (45% of $55,000).

Since this was our first investment in Kyrgyzstan, we wanted to make a relatively small investment, as a test. We wanted to learn more about the business environment and how local entrepreneurs do business. And there certainly was a lot to be learnt.

Our investment in Trilight would not be profitable for us. As a foreign investor, it is costly to manage and monitor the investment. There are local staffing costs, travel costs and various other costs. To make profits, we would need to increase our total investments in Kyrgyzstan, whether in Trilight or other businesses. All we wanted was to work well, do things properly and grow the business. I told him that if things went well, it should be possible to attract more investments and foreign joint venture partners. Main thing was to work well and gain the confidence of investors and partners.

We did not have majority control. It was a risk. We would be relying on Nurgazy to do things properly. Controlling shareholders can do things like charge personal expenses, use company vehicle for personal use and so on. Some of the profits can disappear. This happens everywhere. I expected this to happen. I thought if we received at least 35% share of profits/dividends, that would be acceptable. But I never expected the figure to be 0%, which is what it turned out to be.

Note: A criminal case is currently open. These are two most recent letters I received from the prosecutor.

уведомление

Opening of Criminal Case March 2018

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