Investor in Sochi Games seeks help on rising costs

Wednesday - 4/3/2013, 11:51am EDT

Associated Press

MOSCOW (AP) -- A key investor in Russia's 2014 Olympics is lobbying the government to offer tax rebates for companies operating there to help offset the rising costs.

Sergei Bachin, director general of Roza Khutor, which is building a ski resort, a snowboard and freestyle park and one of the three Olympic villages, said Wednesday that his company asked the government last month to create a special economic zone in the Sochi area.

Roza Khutor is owned by Interros, an investment vehicle of tycoon Vladimir Potanin, which is spending about $2.2 billion on Olympic projects in Sochi.

Bachin said in an interview with the Associated Press that the tax rebates would allow their resort to be "operationally sound" and help them repay loans to the state-owned VEB bank more quickly.

Bachin's petition follows those of others investors who have complained about construction costs they had not been informed of when they first signed up to the Olympic project. Cost estimates for the Sochi Olympics and related development of the region have reached almost $50 billion, making them the most expensive games ever.

The Interfax news agency on Tuesday reported that investors in the Olympic project -- including bank Sberbank, energy company Gazprom, industrial conglomerate Interros and holding company Basic Element -- had asked the government for help.

Sberbank and Gazprom were not available for comment Wednesday. A Basic Element spokesman could not immediately confirm the company signed onto that letter.

Basic Element, a holding company of billionaire Oleg Deripaska, has been public about expecting the government to cover some of their losses.

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