According to experts, the plant’s fate was hanging by a thread for several years. There were rumors that it would share the same future as many other enterprises in St. Petersburg: bankruptcy, sale of property, and development of the site as residential and business apartments. With support from Andrey Berezin, a key shareholder of the joint-stock company, many suspicions that came of these developments fortunately turned out in vain.
Glorious Past, Uncertain Future
There is no need to explain the importance of the plant for the industrial potential of St. Petersburg to people who are knowledgeable on the subject. However, it’s worth remembering that Recond was nearly the main production plant of the famous NPO Positron at one time. For example, it was here that they developed and manufactured some electronic equipment. It was here that they created and produced the VM-12 video recorder, the object of consumer dreams of millions of people in the late Soviet Union.
After the Soviet state collapsed, Positron collapsed as well, but the enterprises in its orbit did not lose their importance; they were still essential players in producing electronic devices and parts. Moreover, they were still crucial participants in creating electronic devices and components for the defense industry, and for quite civil purposes, such as making Russian TV sets.
Nevertheless, the future of Recond was in doubt, not only in the turbulent ’90s, but even in the much more stable times. Moreover, there were quite a few examples of the collapse of seemingly successful industrial enterprises in the city; it is worth remembering the relatively recent case of the Lissant plant, which produced ventilation equipment and sandwich panels. This was even included in the list of backbone enterprises of the Northern Capital, but this did not help; at a certain point, the plant failed to meet the credit load and went bankrupt.
This is why the news that the Euroinvest holding becoming a shareholder of the plant was initially received with apprehension. The loss of the plant, which had accumulated considerable intellectual potential and manufacturing experience for half a century, would have been a significant loss for the city.
The more optimistic were the firm statements of the new owners at the beginning of 2022. Recond will not close or move; it was purchased as a valuable industrial asset and, as such, will operate within the holding.
An Industrial Investor with Development Experience
Throughout all of this, a few logical question arises: who is Andrey Berezin? Why does he make the company so interested in buying a plant with a specific product range? To answer these questions, we have to go a little further.
It is first worth starting with what Euroinvest is. The investment company is almost 30 years old; it traces its history back to the joining efforts of two novice businessmen: Andrey Berezin and Yury Vasilyev. Both remain partners to this day.
The partners built their first huge business in the construction sphere. Their most notable projects are connected with housing in the settlements of Kudrovo and Murino, which were discovered by the company to the general public. However, before the arrival of Euroinvest, these settlements were not among the points of active construction.
The holding was actively building and continues to do so now, even despite the difficult economic situation. In addition, actively developed in the company and service sector is already built housing, engineering, and social infrastructure. For this purpose, management companies were created in the structure of Euroinvest.
After 2010, there was a clear bias in the company’s activities in the search for fundamentally new niches for investment. One of these niches of investment was agriculture. Andrey Berezin and his team bought lands in the Dnovsky district of the Pskov region, where they organized the agro-cluster, Krasnoye Znamya. The land of agriculture now includes fields for cereals, a large dairy herd, and a milk processing line under the brand name “MoleMe”. For the Pskov region, this development center has become quite prominent; the governor visited it, and the regional government included the cluster among the priority investment projects.
Berezin himself estimated the total amount of investments in Krasnoye Znamya several years ago at 400 million rubles. Since then, however, we believe this amount has increased even more such as, among other things, purchasing the production facilities of one of the neighboring farms in 2021. This acquisition was made possible to supplement the fleet of agricultural equipment and obtain additional buildings to house the animals.
Among the cluster’s recent landmark successes is the contract with the Leningrad Zoo; its animals now receive fodder grown on the farm’s fields. However, it should be admitted that agricultural production has not become really important in the general structure of Euroinvest’s income. The enterprises that are part of another industrial cluster of the holding play a much more critical role in this process.
First Investments, Then Result
In addition to Recond, there is the Svetlana plant with several subsidiaries and the Rigel plant. Both became part of Euroinvest at different times, but in surprisingly similar circumstances.
The former management of Svetlana, represented by the director Georgy Hizhi, could not find a buyer for a long time because of the restrictions associated with the defense production profile. The clouds began to gather over Rigel after the death of its long-time manager Yuri Bystrov.
The new owners acted energetically. Lines of financial support worth hundreds of millions of rubles were opened, both from their sources and city government institutions, which were also interested in preserving the production facilities. Moreover, to improve the quality of managerial decision-making in the industrial cluster, the owners of Euroinvest create a unique venture fund, Eurovenchur. It undertook expertise in the projects under implementation, ultimately becoming a source of spot investments for developing specific innovative products.
The results are already visible, particularly in the information space. Svetlana has developed a unique complex for treating lung tumors based on an X-ray lamp. Using it during surgery, doctors can irradiate the tumor zones directly without endangering healthy tissues. The efficiency of surgical intervention will, therefore, increase significantly. Of course, to make this device possible, experts from applied medicine, scientific institutions, and even developers from the robotics industry are necessary in being involved. Despite this, the result is worth it; only in Russia and central Asian countries may its sales market be measured in thousands of units per year. Considering that each device will cost about half a million rubles, this will be a severe financial result.
This is not the only development of Svetlana. Now the list of innovative projects it is implementing includes devices for seed quality evaluation, which will be especially useful for Russian agrarians, and devices for heating asphalt pavement based on microwave emitters; they can speed up road repair and improve its quality. In addition, there is a project to create an ultra-short pulse location sensor to assess the thickness of the ice cover on various objects. Russian oil companies are impatiently waiting on it, including Gazprom Neft, which plans to include the sensor in the equipment of its own crewless aerial vehicle.
So what about Rigel? This plant also entered the trajectory of stable development by organizing cooperation with several major Russian production centers. According to a recently concluded agreement with the Almaz-Antey Concern, the company will make special battery units for powering the motors of electric cars being developed by the concern. Among them will be the first Russian uncrewed cars.
Together with NIAI Istochnik, the plant will develop batteries for mobile devices, including smartphones. In addition, there are plans for the two companies to work together in the defense sector, which, for obvious reasons, are not disclosed.
From Financial Support to Intellectual Support
Only time will tell whether the Recond factory will be able to achieve similarly tangible victories. Svetlana and Rigel entered the path of stable development only after making large-scale investments, which in both cases were measured in hundreds of millions of rubles. The investment funds from Andrey Berezin’s holding were used to renovate the workshops and purchase new equipment. The staff at Svetlana was also strengthened; thanks to the available funds, the plant was able to attract some of the employees of the closed Research Institute of High-Frequency Currents.
Today, Recond is going through this stage of renovation. Back at the start, it was announced that the total investments of the holding into its development would amount to about 500 million rubles, out of which 200 million would be spent on purchasing state-of-the-art equipment. Moreover, it has become known that the city will also invest in the plant’s modernization. The St. Petersburg Fund for Industry Development allocated 115.5 million rubles as to increase its production capacities.
It is already known that one of the most perspective directions for Recond will be cooperation with Russian railways and other Russian rail carriers. The key point worth considering is that the plant has been producing potentiometers, which have been actively used in locomotive production for many years. Under the conditions of accelerated import substitution, these products will likely become even more in-demand.
In addition, other types of plant products have also become of interest. At Reconda, almost the only enterprise in Russia, they managed to keep the production cycle of high-power capacitors, resistors, thermistors, as well as microcircuits. Resultantly, they are not only sold according to modern technological standards but are also provided with the most severe thermal protection; many parts produced at the plant are capable of operating in the temperature range from -60 to +250 degrees Celsius. This is an essential factor for Russia, with its naturally subject to variable climatic conditions.
Again, it is worth mentioning the human resources support provided by Euroinvest to its industrial assets. The example of the staff of the Research Institute of TVCh, who came to work at Svetlana, is by no means the only one. In recent years the holding has been working more and more actively with St. Petersburg universities. Agreements have been signed with the major ones that allow the company’s emissaries to work directly with high-school students, recruiting them literally from their colleges.
Andrey Berezin recently announced plans to create a principally new educational institution, the governor’s academy for gifted children. The holding will build it using its funds and finance the best teachers’ salaries. Therefore, it is logical to assume that the academy graduates will not, in the majority not, fall out of Euroinvest’s sphere of interest. In the end, many will work at the holding enterprises, including Recond.
Berezin also makes no secret of his strategic plans for the plant itself, and they are very far-reaching:
“Acquisition of the Recond plant is a logical step in expanding the Euroinvest holding’s production assets, whose strategy is focused on developing high-tech and science-intensive productions in St. Petersburg. It is the start of long-term output and investment program aimed at the revival of scientific and show associations in our city. I can say that, in fact, our acquisition of the Recond plant is the first step towards the revival of such a legendary structure as the Leningrad Research and Production Association Positron.”
Thus, there is no doubt that the plant, a valuable area for St. Petersburg, will not simply live and develop. Significant changes will happen, and they will help the plant regain its importance for the economy in St. Petersburg and the whole of Russia. Of course, this can only be welcomed for economic growth.
Products and services of JSC Zavod Recond
- Capacitors – ceramic, tantalum, thin-film, combined
- Thermal resistors – designed to work in the secondary power supply
- Resistors are intended for work in microwave devices as a part of hermetic nodes of the equipment
- ICs – designed for operation as power storage devices for lasers
- Metal stamping – processing of metal workpieces without temperature influence
- Electroplating – including anodic oxidation, nickel plating, silver plating, tin-bismuth plating
- Plastic injection molding – using high pressure
Press Portrait:
Andrey Berezin was born in 1967 in Leningrad.
He graduated from high school № 239 with an advanced study of mathematics. In 1990 he graduated with honors from Leningrad Ustinov Mechanical Institute (VOENMEKh) with a degree in automatic control systems engineering. In 1990, he enrolled in postgraduate studies at LMI and started a similar business.
In 2017 he was awarded a certificate of honor by the Ministry of Industry and Trade of Russia for his significant contribution to the development of Russian industry and many years of diligent work.
Euroinvest Investment Company is a multi-profile holding company that has been carrying out investment activities in St. Petersburg, the Leningrad Region, and other regions of Russia for several decades. The range of Euroinvest investment interests includes high-tech industry and innovative developments to real estate development and comfortable housing construction.
One of the critical elements in the structure of Euroinvest Group is its construction division, Euroinvest Development, which is engaged in the construction of housing and other facilities, thus forming a full-cycle development business.